As a brand new investor, you can be accumulating your bitcoin in an exchange toll it has piled up to $500 and above before sending it to your noncustodial wallet for proper UTXO management. By then, the brand new investor must have figured out which of the open source noncustodial wallet is best for him to use.
I would suggest using time as a criterion rather than quantity as a criterion for transfers. I think we can buy Bitcoin for a whole month, deposit it on an exchange and transfer it to a self-custody wallet at the end of the month. A maximum of $1-$2 UTXO per month might not make a big difference.
If we leave an amount on the exchange until we have deposited the equivalent of $500 Bitcoin as you mentioned, then the risk may increase slightly. Our income level may be lower or higher depending on the country and location, and our discretionary money may also be lower or higher. For some people, it may take 2-3 months to deposit $500. I don't think it would be safe to store Bitcoin on an exchange for that long. Even 1 month might be enough for a beginner to learn about wallets.
If a person is buying $10 to $50 per week, then after 3 months, he might ONLY accumulate $130 to $650 in bitcoin, and there is nothing wrong with allowing UTXOs to grow into the $500 territory before transferring them to self-custody.
Of course, when a person is more poor and more of a beginner, there is more worry about any amount of money that might be lost, so each person has to figure out their balances in terms of how much value they want to put in various places, and whether they might be engaging in too much risk to keep coins with 3rd parties or how they might have costs associated with various transaction fees in the present or in the future in regards to how they are managing their UTXOs (unspent transaction outputs).
/snip......For sure, I am not suggesting that bitcoin is guaranteed to go up from here, and there are chances that bitcoin can continue to spiral down from here and forever into the future, so guys have to make choices, even the ones who might have started investing in bitcoin anytime after the 2024 "Trump pump", so they might have had started out buying bitcoin at quite a few price points in the supra $100k price territories, including all the way up to $120k before the BTC price returned back below $100k and then we got caught in mostly below $80k prices since February of this year.
So guys have to make choices, and yeah, maybe some guys were trying to front-load their investment into bitcoin through late 2024 and even through most of 2025, so then after 2025, they were starting to feel that they did not have a lot of money remaining in their budget to continue to put more value in bitcoin.
So then in the end, they still need to decide what are they going to do? continue to buy bitcoin? or just wait it out and not buy more? or worse to sell some or all of their bitcoin at lower prices?
and guys have to choose what they are going to do while realizing that there are no guarantees in regards to the outcome, and they might not even realize the extent to which they made good choices or bad choices for several years down the road. In 2015, there were all kinds of folks in real life and even in online forums who were laughing at me and at guys like me, and they were proclaiming that bitcoin was dead. I recall even having some arguments in person with some folks who would proclaim that it would be better to take some value out, and I would say, that they are giving me "advice" about bitcoin while they have hardly any clue about what bitcoin actually is. All they see is that bitcoin had gone up to $1,163 and then in these recent times, bitcoin is mostly bouncing around between $220 and $240 for months and months and months.
Another thing is that if guys have enough money to cover their expenses. I had a business in which my business partner had abandoned the business in that time, and I had to negotiate with some vendors to spread out the payments and even the landlord regarding not paying rent for two months, and so otherwise the bills were still being covered and there was a path forward in which the income was still coming in, even though at a rate that involved less income and more expenses... but at the same time, the worst of it was only a few months...and yeah, an easy way out could have had been to slice some value off of the bitcoin, yet I did not do that. I just had to set bitcoin aside for a while in terms of not being able to buy any bitcoin for several months (during months that the BTC prices were the lowest, or at least in a trench). So sometimes we might have to juggle things around to make sure that the income and the expenses line up.. to maybe figure out ways to try to increase income and to decrease expenses, even though certain kinds of expenses might not be able to cut back on since if there are some troubles with the business, then there might be some additional expenses that might also come from the transition of the business.
Do you think it is easy to make those decisions? You've been involved in all of this for a long time, and i don't think it was easy to make any move when it came to investing and everything else that comes with it. I know there are all kinds of people, from skeptics to those who don't believe in anything, but when they see that you have some BTC, they start asking questions and then want to do the same, of course without any prior knowledge.
I would not claim these balances are easy for anyone in terms of trying to figure out how much (if any) to put into bitcoin as compared with other places that guys could put their time, energy and value. So, guys have to make choices to decide based on their own circumstances how much to put into bitcoin as compared with other places and if they want to invest into bitcoin as aggressively as they can without over doing it. They also have to figure out how to manage their cashflows too, which is also not easy.
Actually let me take it back. All of the skills necessary to manage finances and psychology related to bitcoin are within basic skills, yet there still can be delemmas regarding what to do and what and how to prioritize matters.
So, of course, guys have to consider their own
9 individual factors and such 9 individual factors are likely ongoingly changing throughout the life of any bitcoin investor, so from time to time, the bitcoin investor might need to tweak what he is doing based on changes in his 9 individual factors.
As for that difficult period, you were lucky that it only lasted a few months. And even if you had sold your BTC, you wouldn't have made a mistake because you needed that money at the time, and that's it. I think about what i would do if i were going through such a difficult period. I would try to forget that I even had any BTC, and at the same time i would look for other ways to make money.
Guys can make mistakes and not even realize that they made a mistake until several years later when they might end up having way fewer coins than they could have had and that they should have had absent the mistakes that they had made.
Many times guys end up selling too much bitcoin too soon and they might argue that they are 3x or 5x or more in profits, yet I doubt that guys who sold most or all of their bitcoin in late 2016 or early 2017 for anywhere between $600 and $2,000 were feeling very good in late 2017 or any time later since BTC prices never ever again returned below $3,124 and they even spent ONLY very short periods of time at any place below $4,500, and sure many guys coming into bitcoin late 2017 or later would have really been thrilled to have had been able to make very many bitcoin purchases in the lower $6ks or below $6k.
And, even so, it may have had taken many years, maybe even by the time late 2020 came before guys realized that any prices below $6k were never going to be seen again. So, you should be able to realize that there are all kinds of price points between the $250 prices in 2015 and the various price points in various times between 2016 and 2020, so there were a lot of guys with regrets of selling way too many bitcoin too soon during those times, even though it may have taken several years before they finally realized that they had sold too many coins too soon and that they would never be able to buy coins back for the prices that they had sold some or all of their bitcoin at.
And what do you think, in the times we are living in now, with so much inflation and various situations that have a very negative impact on the economy, how possible is it to balance things out and keep our income and expenses aligned? I know quite a few people whose expenses are higher than their income, but they are still fighting to get by, especially small business owners who are at the beginning of their careers. They are currently working and still hoping that things will get better.
All times have challenges, and frequently perceptions of injustices, yet each person still has to figure out how to allocate his time, energy and value, and many times we talk about needs for discretionary funds to be able to invest - otherwise if you need funds and you are trading to try to increase your short term income from bitcoin or any other asset, then you are likely gambling rather than investing.
Another challenge might be geographical, since there are some parts of the worlds that are more challenging than others in terms of trying to be able to find ways to increase your income so that you have discretionary funds available to invest, and so guys have to figure out what is available to them and what kinds of skills, knowledge and experiences might help them in terms of getting better paying jobs and/or even more secure jobs.
Frequently younger people might have more potential for opportunities as compared with guys who might have gone down certain job/career paths that end up locking them in and causing a lot of difficulties to change or to be able to find work outside of their job experiences or even their abilities to learn new skills that might result in ways to increase their income. Life choices will sometimes have consequences, and there surely may have been guys who did not have very many choices in terms of what they might be able to do, so they still have to work within where they are at and what might be realistically available to them.
Yep. I had friends who had 21 bitcoin and 17 bitcoin in 2016-ish time frame, and then one of them was down to 10 bitcoin a few years later and the other down to 4 bitcoin, and they could have kept building their bitcoin stash little by little or at least not depleting their bitcoin holdings. It becomes impossible to build back up, even though they think that they are geniuses when they sell for various levels of profits along the way.. .but then they end up as no coiners or low coiners.. and even if their bitcoin might go up in value, they do not have much of at various later dates down the road.
That is a very sad story, i don't want to be hearing story like this because it get me frustrated for someone to make this kind of mistake, I don't see it an achievement if the value continue to increase without the quantity, but honestly I will say that they have make a very big mistake, because I can confidently say that even when they sold it the price will not be as much as it is in the last three years back. A lot of people usually have this kind of thinking because they always believe that they are genius and they can be able to play smartly thinking that if it drop they can get more, but in the case of Bitcoin it actually very difficult only few survive it.
This is not actually a mistake but they are negligent, they forgot that they need backup for Thier Bitcoin investment or should I say they purposely did it feeling that emergency may not happen until they achieve Thier target? considering the amount of Bitcoin they accumulated I'm sure that building an emergency funds won't be an issue but they feel that it's not relevant since there's no emergency need at the moment that it will continue to be like that until they reach Thier investment target just as many investors believe. I frequently suggest that every Bitcoin investors need to make sure that they have a backup funds such as emergency funds because there might be an impending emergencies and they wouldn't know.
The people I describing did not need back up funds, since they already had back up funds, and they ended up needing to understand the power of bitcoin rather than selling too much too soon. They were thinking about the profits that they had and the things that they could buy, and they were lacking long term perspective or even a vision of where they were wanting to go.
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Its not really easy to make financial decisions on that situation. Because even those well experience people struggles, during in though situations in life. This is why I thing sometimes selling their BTC make sense if they used it on important matters just to survive.
With current situation we are facing now like economy is unstable then inflation rate is so high, many people struggles to balance their expenses and also their income. If that situation occur much better for people to pay attention on stabilizing their income first, then cut those unnecessary spending's and find good ways to have extra income. With this they can bounce back and continue their smooth investment flow on Bitcoin.
I know @JayJuanGee don't like waiting, but this is really a realistic approach if they face such scenario.
Its really possible for people to balance these things, but this will take patience as well as discipline then also those realistic decision base on their current situation.
Guys have to have discretionary funds to invest, and if they do not have discretionary funds they cannot invest. I would not call that waiting, since if they do not have discretionary funds, they do not have a choice.
If they have discretionary funds, then they can choose to invest whenever they have enough funds, whether that is weekly or monthly or whatever other timeline. If they have discretionary funds and they are waiting for the dip, then I doubt that would be a good approach to bitcoin investing.
there is nothing wrong with starting to buy bitcoin even though you don't have a secured wallet yet, you can always get your hands on one later but the fact that you don't have yet shouldn't be what prevents you from buying bitcoin, there are alot of people who started buying and holding their bitcoin from exchanges, it's not the safest but they did not let access to a good wallet stop them from buying bitcoin and frankly you shouldn't either, your bitcoin can always be moved to a secure wallet on a later date.
Everything is wrong with starting your bitcoin accumulation journey when you don't have a well secured wallet. Come on, what's the point in accumulating Bitcoin without having a secured wallet? or do you plan to accumulate Bitcoin for hackers to come and steal it?
However, before you start your bitcoin accumulation journey, you need to get yourself a well secured self custodial wallet for storing your Bitcoin, otherwise you could end up losing years of sacrifice and effort spent stacking those bitcoins.
It was never advisable to start your bitcoin investment journey without having a secured self custodial wallet. Also, keeping your bitcoin on a centralized exchange is very risky, because it is not your key, not your coin. Get a self custodial wallet instead.
Bitcoin newbies do not need to get a self-custody wallet to start, even though their goal should be to self-custody their coins.
All bitcoiners should also tailor their security to their bitcoin holdings, so the larger the holdings the greater the security.
And, yeah, guys have to figure out how much security they need and even how much to prioritize self-custody.
Bitcoin would have little to no power or value if self-custody were not practiced, but self custody does not need to be learned or secured prior to getting started buying bitcoin.
