Discretionary Income vs Emergency Funds: Why It Matters for Bitcoin Investing

[liasbaa]

-snip-

The increasing depreciation of fiat is encouraging Bitcoin adoption. Investors are increasingly choosing to store Bitcoin rather than holding fiat in traditional institutions. Inflation has exacerbated the problem, as the erosion and depreciation of fiat have led investors to accumulate Bitcoin rather than hold those assets.

You could be right - but probably not significantly. Every investor has their own preferences regarding which assets are suitable as hedge against the loss of fiat currency value due to inflation - bitcoin is just one option, not the only one. Many investors are reluctant to invest in Bitcoin because their risk tolerance tends to favor assets with low price fluctuations - while Bitcoin is considered one of the highest. They can invest a certain amount in Bitcoin, but not as their primary investment - it's up to them and their investment plan.

I agree with you. There are other alternatives besides Bitcoin, but most are on par with the eroded fiat. A review of the harmful effects of inflation shows that the depreciation of fiat can lead to the depreciation of assets related to it, such as real estate, stocks and bonds. Where many investors feel more confident in investing in these areas. Considering the risk tolerance, although Bitcoin has a higher level of volatility, its potential for future price increases and a stable financial system can play a great role in implementing an important hedge against inflation.

Decentralized investing ensures you have self-custody of your assets.

Only if you store bitcoin in your wallet - not with a third party.

Of course! I said decentralized assets- I only mean store Bitcoin.

[Makus]

The trick is, whatever is left after you spend for a full month, is the money you saved.

Instead of a monthly Bitcoin savings strategy, a weekly one might be a better investment strategy. Accumulation monthly would only add up to 12 times in a year. If you deposit Bitcoin weekly, that number would be 48 and over a four year cycle, that number would be 192. Regardless of the deposit amount the more Bitcoin hits your portfolio, the more your holdings will continue to grow. For smaller investors, a small scale Bitcoin accumulation strategy can provide higher returns at the end of their cycle. The higher the cycle, the higher the return.

There are 52 weeks in a year, so over 4 years there are 208 weeks.  If you invest $100 per week for 10 years, then you would have had invested $52k, yet surely the value of the investment will depend on if the bitcoin price went up or down and also if it outpaced the debasement of the dollar or was able to outperform other places that you might have had chosen to put your money.

If you had deposited fiat in traditional banks for 10 years, you would have probably earned a maximum of 5% profit after deducting all charges. During this time, the value of money may have decreased due to inflation and there may be doubts about getting money from financial institutions on time during financial crises. And overall, if you calculate, then in these 10 years, there could be a huge deficit from your capital.

If you had invested in Bitcoin, it would have given you several times the profit, this can be said almost certainly. It may be a bit unfair to say for sure because the assumption about the price may not be correct. In the case of Bitcoin, the logical reason for this is its limited supply and the recommendation and widespread adoption of increasing strategic reserves.

Of course part of the investment thesis for bitcoin is to provide a sort of hedge against the dollar  (and fiats) and a hedge against debasement and robbing of value that somewhat subtly takes place through fiat systems and even the way that debt is employed..   And as you mentioned bitcoin is a good hedge but it is not necessarily guaranteed to be successful.

Furthermore, Bitcoin is not going to completely stop the various shenanigans that happen through fiat and/or debt systems, yet it seems to attempt to put a pretty large check upon such systems, especially if adoption becomes somewhat widespread and normies do not contract away all of their rights to self-custody, since a decent amount of the power of bitcoin comes from an ability to take self custody and transact directly with other people/businesses/governments in the case that custodians are not being honest in their fiduciary duties, including their ways of diluting the supply and/or fractionally reserving it. Accordingly, it can be difficult to know the extent to which bitcoin an overcome the various fiat/debt based systems that already exist.

The increasing depreciation of fiat is encouraging Bitcoin adoption. Investors are increasingly choosing to store Bitcoin rather than holding fiat in traditional institutions. Inflation has exacerbated the problem, as the erosion and depreciation of fiat have led investors to accumulate Bitcoin rather than hold those assets. The impact of the erosion of traditional assets is leading us to a stage where you are being robbed of your money at every traffic system. Economists believe that inflation is a deliberate process of looting of the centralized financial system that ordinary citizens cannot see with the naked eye. Decentralized investing ensures you have self-custody of your assets.

I see this thing everyday, money in the bank is just turning to paper. You keep it for months thinking you are saving, but when you come back to use it, the value is already gone. That is the painful part, you don’t notice it immediately, it just happens little by little until you feel it heavy. Even common food in the market tells you the truth, what you bought last week is more expensive today. That is why Bitcoin is different, because nobody can just sit somewhere and print it to destroy the value. When you hold it yourself, it is you in charge, not one government man pressing button…

The problem with fiat is that the stealing is silent. Nobody is coming to collect your money with gun, but every day your purchasing power is reduced...  They call it inflation like it is normal, but it is actually a way of taking from people without them knowing. Bitcoin doesn’t work like that, it is open, limited, and it ca not be manipulated like fiat. That is why people are shifting to it, not because it is fashion or hype, but because it is the only way to hold value without being robbed by the system..

[liasbaa]

The trick is, whatever is left after you spend for a full month, is the money you saved.

Instead of a monthly Bitcoin savings strategy, a weekly one might be a better investment strategy. Accumulation monthly would only add up to 12 times in a year. If you deposit Bitcoin weekly, that number would be 48 and over a four year cycle, that number would be 192. Regardless of the deposit amount the more Bitcoin hits your portfolio, the more your holdings will continue to grow. For smaller investors, a small scale Bitcoin accumulation strategy can provide higher returns at the end of their cycle. The higher the cycle, the higher the return.

There are 52 weeks in a year, so over 4 years there are 208 weeks.  If you invest $100 per week for 10 years, then you would have had invested $52k, yet surely the value of the investment will depend on if the bitcoin price went up or down and also if it outpaced the debasement of the dollar or was able to outperform other places that you might have had chosen to put your money.

If you had deposited fiat in traditional banks for 10 years, you would have probably earned a maximum of 5% profit after deducting all charges. During this time, the value of money may have decreased due to inflation and there may be doubts about getting money from financial institutions on time during financial crises. And overall, if you calculate, then in these 10 years, there could be a huge deficit from your capital.

If you had invested in Bitcoin, it would have given you several times the profit, this can be said almost certainly. It may be a bit unfair to say for sure because the assumption about the price may not be correct. In the case of Bitcoin, the logical reason for this is its limited supply and the recommendation and widespread adoption of increasing strategic reserves.

Of course part of the investment thesis for bitcoin is to provide a sort of hedge against the dollar  (and fiats) and a hedge against debasement and robbing of value that somewhat subtly takes place through fiat systems and even the way that debt is employed..   And as you mentioned bitcoin is a good hedge but it is not necessarily guaranteed to be successful.

Furthermore, Bitcoin is not going to completely stop the various shenanigans that happen through fiat and/or debt systems, yet it seems to attempt to put a pretty large check upon such systems, especially if adoption becomes somewhat widespread and normies do not contract away all of their rights to self-custody, since a decent amount of the power of bitcoin comes from an ability to take self custody and transact directly with other people/businesses/governments in the case that custodians are not being honest in their fiduciary duties, including their ways of diluting the supply and/or fractionally reserving it. Accordingly, it can be difficult to know the extent to which bitcoin an overcome the various fiat/debt based systems that already exist.

The increasing depreciation of fiat is encouraging Bitcoin adoption. Investors are increasingly choosing to store Bitcoin rather than holding fiat in traditional institutions. Inflation has exacerbated the problem, as the erosion and depreciation of fiat have led investors to accumulate Bitcoin rather than hold those assets. The impact of the erosion of traditional assets is leading us to a stage where you are being robbed of your money at every traffic system. Economists believe that inflation is a deliberate process of looting of the centralized financial system that ordinary citizens cannot see with the naked eye. Decentralized investing ensures you have self-custody of your assets.

I see this thing everyday, money in the bank is just turning to paper. You keep it for months thinking you are saving, but when you come back to use it, the value is already gone. That is the painful part, you don’t notice it immediately, it just happens little by little until you feel it heavy. Even common food in the market tells you the truth, what you bought last week is more expensive today. That is why Bitcoin is different, because nobody can just sit somewhere and print it to destroy the value. When you hold it yourself, it is you in charge, not one government man pressing button…

The problem with fiat is that the stealing is silent. Nobody is coming to collect your money with gun, but every day your purchasing power is reduced...  They call it inflation like it is normal, but it is actually a way of taking from people without them knowing. Bitcoin doesn’t work like that, it is open, limited, and it ca not be manipulated like fiat. That is why people are shifting to it, not because it is fashion or hype, but because it is the only way to hold value without being robbed by the system..

The most significant reason why people are constantly turning to Bitcoin is to protect their wealth from the effects of inflation and to save their wealth from the process of plunder. You don't have to be very educated to understand how the value of paper money is decreasing. If you look at an example, you will see that if you consider the statistics of the wealth of those who deposit in banks or buy bonds or invest in the stock market to increase their wealth, their wealth is currently eroding compared to what it was five years ago. The main reason for this is inflation and the bad economic decisions taken by the government.

Every year during the budget preparation they start devising strategies to plunder a huge amount of money from the citizens and the affected citizens are forced to pay it. I have mentioned the traffic systems for the erosion and depreciation of fiat, among which creating inflation and the strange budget preparation taken by the government are notable. The value of the country can never be increased by printing fiat currency, it is a destructive process.  That's why people are ready for widespread adoption of Bitcoin and the contexts of different countries are shaping up accordingly.

[_BlackStar]

-snip-

I agree with you. There are other alternatives besides Bitcoin, but most are on par with the eroded fiat. A review of the harmful effects of inflation shows that the depreciation of fiat can lead to the depreciation of assets related to it, such as real estate, stocks and bonds. Where many investors feel more confident in investing in these areas. Considering the risk tolerance, although Bitcoin has a higher level of volatility, its potential for future price increases and a stable financial system can play a great role in implementing an important hedge against inflation.

You mentioned that the potential for future price increases is the reason some investors choose Bitcoin as a hedge against inflation. I don't rule out other possibilities, such as prolonged price declines due to government intervention and other global issues that drag down the price of Bitcoin and other assets - but Bitcoin's decentralization and limited supply also play a significant role in maintaining investor confidence in it.

Bitcoin is suitable for some investors - not all, especially if they dislike high price volatility. Bitcoin's scarcity and decentralization are two reasons why it's worth considering as a hedge, in my opinion - but one shouldn't force themselves to invest in it if they prefer traditional hedge assets.

[liasbaa]

-snip-

I agree with you. There are other alternatives besides Bitcoin, but most are on par with the eroded fiat. A review of the harmful effects of inflation shows that the depreciation of fiat can lead to the depreciation of assets related to it, such as real estate, stocks and bonds. Where many investors feel more confident in investing in these areas. Considering the risk tolerance, although Bitcoin has a higher level of volatility, its potential for future price increases and a stable financial system can play a great role in implementing an important hedge against inflation.

You mentioned that the potential for future price increases is the reason some investors choose Bitcoin as a hedge against inflation. I don't rule out other possibilities, such as prolonged price declines due to government intervention and other global issues that drag down the price of Bitcoin and other assets - but Bitcoin's decentralization and limited supply also play a significant role in maintaining investor confidence in it.

Bitcoin is suitable for some investors - not all, especially if they dislike high price volatility. Bitcoin's scarcity and decentralization are two reasons why it's worth considering as a hedge, in my opinion - but one shouldn't force themselves to invest in it if they prefer traditional hedge assets.

Of course. You cannot force those people if they do not want to adjust themselves to Bitcoin. If they want to stay with centralized wealth and let themselves be depleted, then that is completely their choice. You can only advise them that the future prospects of Bitcoin are still within everyone's reach. Rich or poor people of any income can buy Bitcoin.

The citizens of the country always lament that their purchasing power has decreased a lot considering their financial capacity 5-10 years ago. Skyrocketing prices of every product. This is the effect of inflation. As a common citizen, you cannot rebel against the state. In some cases, there is no way to reduce the financial expenditure of the government. The foreign currency in the reserve has to be spent to pay for the price of the product, so they become financially weak. Due to which the citizens of the country take foreign loans and print paper money and release it in the market, so the price of the product increases.

Decentralized financial systems should be considered as an alternative to remaining stuck with centralized traditional financial systems.

[Cossyblack]

The trick is, whatever is left after you spend for a full month, is the money you saved.

Instead of a monthly Bitcoin savings strategy, a weekly one might be a better investment strategy. Accumulation monthly would only add up to 12 times in a year. If you deposit Bitcoin weekly, that number would be 48 and over a four year cycle, that number would be 192. Regardless of the deposit amount the more Bitcoin hits your portfolio, the more your holdings will continue to grow. For smaller investors, a small scale Bitcoin accumulation strategy can provide higher returns at the end of their cycle. The higher the cycle, the higher the return.

There are 52 weeks in a year, so over 4 years there are 208 weeks.  If you invest $100 per week for 10 years, then you would have had invested $52k, yet surely the value of the investment will depend on if the bitcoin price went up or down and also if it outpaced the debasement of the dollar or was able to outperform other places that you might have had chosen to put your money.

If you had deposited fiat in traditional banks for 10 years, you would have probably earned a maximum of 5% profit after deducting all charges. During this time, the value of money may have decreased due to inflation and there may be doubts about getting money from financial institutions on time during financial crises. And overall, if you calculate, then in these 10 years, there could be a huge deficit from your capital.

If you had invested in Bitcoin, it would have given you several times the profit, this can be said almost certainly. It may be a bit unfair to say for sure because the assumption about the price may not be correct. In the case of Bitcoin, the logical reason for this is its limited supply and the recommendation and widespread adoption of increasing strategic reserves.

Of course part of the investment thesis for bitcoin is to provide a sort of hedge against the dollar  (and fiats) and a hedge against debasement and robbing of value that somewhat subtly takes place through fiat systems and even the way that debt is employed..   And as you mentioned bitcoin is a good hedge but it is not necessarily guaranteed to be successful.

Furthermore, Bitcoin is not going to completely stop the various shenanigans that happen through fiat and/or debt systems, yet it seems to attempt to put a pretty large check upon such systems, especially if adoption becomes somewhat widespread and normies do not contract away all of their rights to self-custody, since a decent amount of the power of bitcoin comes from an ability to take self custody and transact directly with other people/businesses/governments in the case that custodians are not being honest in their fiduciary duties, including their ways of diluting the supply and/or fractionally reserving it. Accordingly, it can be difficult to know the extent to which bitcoin an overcome the various fiat/debt based systems that already exist.

The increasing depreciation of fiat is encouraging Bitcoin adoption. Investors are increasingly choosing to store Bitcoin rather than holding fiat in traditional institutions. Inflation has exacerbated the problem, as the erosion and depreciation of fiat have led investors to accumulate Bitcoin rather than hold those assets. The impact of the erosion of traditional assets is leading us to a stage where you are being robbed of your money at every traffic system. Economists believe that inflation is a deliberate process of looting of the centralized financial system that ordinary citizens cannot see with the naked eye. Decentralized investing ensures you have self-custody of your assets.

I see this thing everyday, money in the bank is just turning to paper. You keep it for months thinking you are saving, but when you come back to use it, the value is already gone. That is the painful part, you don’t notice it immediately, it just happens little by little until you feel it heavy. Even common food in the market tells you the truth, what you bought last week is more expensive today. That is why Bitcoin is different, because nobody can just sit somewhere and print it to destroy the value. When you hold it yourself, it is you in charge, not one government man pressing button…

The problem with fiat is that the stealing is silent. Nobody is coming to collect your money with gun, but every day your purchasing power is reduced...  They call it inflation like it is normal, but it is actually a way of taking from people without them knowing. Bitcoin doesn’t work like that, it is open, limited, and it ca not be manipulated like fiat. That is why people are shifting to it, not because it is fashion or hype, but because it is the only way to hold value without being robbed by the system..

The banks charged you for savings your money in their vault,they deduct a fee from your money every month for maintenance. This little fees reduces the value of your money instead of adding to it. Inflation bit harder and the same money that was valued will begin to shrink overtime. I think the banking system wasn't just created to protect our funds but was also designed to rob us of it. The world is shifting to Bitcoin because it gives you the full rights and access to funds,100% decentralized and safe from inflation and hackers. FIATs converted to Bitcoin will grows in value and if Hodl for a long term period of 4-10years can grow 5X - 10X  of the initial investments capital.