Bitcoin is still early

[ENT Doc]

No offense taken. While I still am generating significant income, I will keep investing the majority of that income in the hope to have returns for myself, my family, or my charities of choice.

God willing, I plan to work at least another 10-13 years...so my time horizon for buying is at least that long and my time horizon for holding my investments is a lot longer.

I’ll preface this by saying I have not read the prior 143! pages in this thread. But Bitcoin as an investment is speculative and as an actual currency isn’t realistic. It has a fixed supply making it highly volatile as a currency, which undercuts the basic notion of a currency. As an investment, it’s pure speculation based on the willingness of the next sucker who doesn’t understand this basic fact to pay more than you did. No thanks.

[Dont_know_mind]

I have been buying and keep buying. DCA is the way for me at this point. Just like the rest of my investments.

That being said, I have been buying much harder over the past 6 months than I did in all of 2021. The lower it goes, the more I buy.

DCA into Bitcoin is NOT like dollar cost averaging into a broad based index fund. It is delusional to think it is. You may be setting yourself up for getting badly whipped.

[jacoavlu]

I’ll preface this by saying I have not read the prior 143! pages in this thread. But Bitcoin as an investment is speculative and as an actual currency isn’t realistic. It has a fixed supply making it highly volatile as a currency, which undercuts the basic notion of a currency. As an investment, it’s pure speculation based on the willingness of the next sucker who doesn’t understand this basic fact to pay more than you did. No thanks.

you should fork bitcoin, to an alternative coin that doesn’t have a fixed supply. Maybe you could set an inflation rate that is fixed for perpetuity, or you could set an inflation rate to vary based on some various input factors, or maybe even the coin supply and inflation rate could be periodically adjusted by a group of people like a special board or something, that way the btc to usd rate of exchange isn’t so volatile

You could keep everything else the same, or of course you could tweak other things too

[jacoavlu]

DCA into Bitcoin is NOT like dollar cost averaging into a broad based index fund. It is delusional to think it is. You may be setting yourself up for getting badly whipped.

curious how you think it’s different?

[ENT Doc]

you should fork bitcoin, to an alternative coin that doesn’t have a fixed supply. Maybe you could set an inflation rate that is fixed for perpetuity, or you could set an inflation rate to vary based on some various input factors, or maybe even the coin supply and inflation rate could be periodically adjusted by a group of people like a special board or something, that way the btc to usd rate of exchange isn’t so volatile

You could keep everything else the same, or of course you could tweak other things too

Indeed, you COULD do all of that. And then it would be a viable currency option. But since we are talking about Bitcoin specifically we can’t do those things. And even if you could flip the switch and do that, what on earth would you be investing in?

[jacoavlu]

Indeed, you COULD do all of that. And then it would be a viable currency option. But since we are talking about Bitcoin specifically we can’t do those things. And even if you could flip the switch and do that, what on earth would you be investing in?

well if you make a better version of bitcoin then all the users and miners and bitcoin related companies would migrate to your coin and then that coin would “be bitcoin”.

If you were in early then you would be rich.

you could just fork the chain and use the existing utxo set to airdrop coins to current holders. Like BCH and BSV and other forks. Or you could start from zero, or do whatever you want.

i mean it’s just open source software. Anyone is free to make whatever changes they think make it better

[Dont_know_mind]

DCA into Bitcoin is NOT like dollar cost averaging into a broad based index fund. It is delusional to think it is. You may be setting yourself up for getting badly whipped.

I think that is an essential aspect of investing IMO.
You DCA into an asset that has a very high probability of eventually recovering, otherwise you are just adding to your position over time and increasing your risk (in a Martingale type of betting style if it goes against you).

For a speculative asset, you will be either right or wrong.
No need to DCA. Just bet what your position size should be based on what you can afford to lose and your expected probabilities at the beginning. Hopefully you are actually early in the trend and not at the end.
But adding to position over time, particularly if it is going against you increases your risk of ruin.

Say Shiba Inu Coin, should I DCA into Shiba? How does that mitigate risk? Sames with Bitcoin perhaps.

Last quarter I invested in something speculative (uranium stocks). I allocated 3% of my risk capital to that. I felt no need to DCA. It will either pan out or not and 3% is how much I want to risk on this. I am not going to buy more if it goes up or down. I guess others may invest in a different way.

[Lordosis]

I think that is an essential aspect of investing IMO.
You DCA into an asset that has a very high probability of eventually recovering, otherwise you are just adding to your position over time and increasing your risk (in a Martingale type of betting style if it goes against you).

For a speculative asset, you will be either right or wrong.
No need to DCA. Just bet what your position size should be based on what you can afford to lose and your expected probabilities at the beginning. Hopefully you are actually early in the trend and not at the end.
But adding to position over time, particularly if it is going against you increases your risk of ruin.

Say Shiba Inu Coin, should I DCA into Shiba? How does that mitigate risk? Sames with Bitcoin perhaps.

Last quarter I invested in something speculative (uranium stocks). I allocated 3% of my risk capital to that. I felt no need to DCA. It will either pan out or not and 3% is how much I want to risk on this. I am not going to buy more if it goes up or down. I guess others may invest in a different way.

You really nailed it. But I think the problem is Bitcoin bros do not see it as speculative. I know plenty of people who feel that Bitcoin is surely going to be higher at some point in the future. And it isn't just optimism. Because a lot of those same people don't think vtsax will be up.

[jacoavlu]

I think that is an essential aspect of investing IMO.
You DCA into an asset that has a very high probability of eventually recovering, otherwise you are just adding to your position over time and increasing your risk (in a Martingale type of betting style if it goes against you).

For a speculative asset, you will be either right or wrong.
No need to DCA. Just bet what your position size should be based on what you can afford to lose and your expected probabilities at the beginning. Hopefully you are actually early in the trend and not at the end.
But adding to position over time, particularly if it is going against you increases your risk of ruin.

Say Shiba Inu Coin, should I DCA into Shiba? How does that mitigate risk? Sames with Bitcoin perhaps.

Last quarter I invested in something speculative (uranium stocks). I allocated 3% of my risk capital to that. I felt no need to DCA. It will either pan out or not and 3% is how much I want to risk on this. I am not going to buy more if it goes up or down. I guess others may invest in a different way.

the point you seem to be making is that the investments (bitcoin and index funds) aren’t the same. Which I don’t think is something that anyone reasonable has actually said

i think when people talk about DCA into bitcoin they don’t really mean DCA. As in holding a chunk of cash and allocate the cash to bitcoin but buying over time. That’s what DCA really is

what they’re actually doing would be better termed periodic investing, basically buying some bitcoin (and index funds) periodically when you earn money and invest.

[jacoavlu]

You really nailed it. But I think the problem is Bitcoin bros do not see it as speculative. I know plenty of people who feel that Bitcoin is surely going to be higher at some point in the future. And it isn't just optimism. Because a lot of those same people don't think vtsax will be up.

you must know some real hard core anarchists

[Tim]

I think that is an essential aspect of investing IMO.
You DCA into an asset that has a very high probability of eventually recovering, otherwise you are just adding to your position over time and increasing your risk (in a Martingale type of betting style if it goes against you).

For a speculative asset, you will be either right or wrong.
No need to DCA. Just bet what your position size should be based on what you can afford to lose and your expected probabilities at the beginning. Hopefully you are actually early in the trend and not at the end.
But adding to position over time, particularly if it is going against you increases your risk of ruin.

Say Shiba Inu Coin, should I DCA into Shiba? How does that mitigate risk? Sames with Bitcoin perhaps.

Last quarter I invested in something speculative (uranium stocks). I allocated 3% of my risk capital to that. I felt no need to DCA. It will either pan out or not and 3% is how much I want to risk on this. I am not going to buy more if it goes up or down. I guess others may invest in a different way.

What is Value at Risk (VaR)?

https://corporatefinanceinstitute.com/resources/knowledge/trading-investing/value-at-risk-var/

Risk actually is quantifiable. In the investment world, position sizing is not left to "gut feel".
The VaR risk was developed by CitiGroup and it was made available to the public. It was subsequently sold to MSCI and put behind licensing and paywalls.
The formulas are there for anyone that cares to write the programs. If you want to trade with the big boys, probably need some risk management tools.

[xraygoggles]

I think that is an essential aspect of investing IMO.
You DCA into an asset that has a very high probability of eventually recovering, otherwise you are just adding to your position over time and increasing your risk (in a Martingale type of betting style if it goes against you).

For a speculative asset, you will be either right or wrong.
No need to DCA. Just bet what your position size should be based on what you can afford to lose and your expected probabilities at the beginning. Hopefully you are actually early in the trend and not at the end.
But adding to position over time, particularly if it is going against you increases your risk of ruin.

Say Shiba Inu Coin, should I DCA into Shiba? How does that mitigate risk? Sames with Bitcoin perhaps.

Last quarter I invested in something speculative (uranium stocks). I allocated 3% of my risk capital to that. I felt no need to DCA. It will either pan out or not and 3% is how much I want to risk on this. I am not going to buy more if it goes up or down. I guess others may invest in a different way.

Yep - just allocate a set % of portfolio (low single digits), & then - crucially - REBALANCE so you sell during bubbles and buy during bear mkts (ie buy low sell high).

"Diamond hands" is a meme for speculative assets - not an investment strategy.

[NapoleanDynamite]

DCA into Bitcoin is NOT like dollar cost averaging into a broad based index fund. It is delusional to think it is. You may be setting yourself up for getting badly whipped.

I guess that makes me in to Bitcoin S and M then

[NapoleanDynamite]

I’ll preface this by saying I have not read the prior 143! pages in this thread. But Bitcoin as an investment is speculative and as an actual currency isn’t realistic. It has a fixed supply making it highly volatile as a currency, which undercuts the basic notion of a currency. As an investment, it’s pure speculation based on the willingness of the next sucker who doesn’t understand this basic fact to pay more than you did. No thanks.

Maybe you should go back and read through the entire thread...There is a lot of good learning and you can see how the space has evolved over the past 27 months. But as Satoshi said: "If you don't believe me or don't get it, I don't have time to try to convince you, sorry."

[Tim]

Maybe you should go back and read through the entire thread...There is a lot of good learning and you can see how the space has evolved over the past 27 months. But as Satoshi said: "If you don't believe me or don't get it, I don't have time to try to convince you, sorry."

https://finance.yahoo.com/news/sec-says-9-25-assets-055428700.html?fr=yhssrp_catchall

The rules are changing. Even Mark Cuban is ranting. Using enforcement before regulations.