Topic: [ANN] JJG Sustainable Bitcoin Withdrawal Strategy - page 2. (Read 1849 times)

We can back test various withdrawal rates, and see that historically, BTC has been been appreciating in value more than 10% per year, even using the 200-WMA, so historically we would have had been able to get away with 10% withdrawal rates and the dollar value of our holdings would have continued to grow.

Surely 4-6% is even more than reasonable with bitcoin's historical performance, and surely would likely amount in considerable ongoing growth in the value of the BTC holdings, in spite ongoing withdrawals, and a 1-2% withdrawal rate would even be allowing the value of the BTC holdings to go up quite a bit, especially if we might average out the withdrawal numbers over a whole cycle or more.  Withdrawing at ONLY 1-2% would pretty much allow for fairly aggressive growth in the value of bitcoin holdings, which may or may not be a desired outcome, even though surely I am aware of people ongoingly being worried about their retirements stashes holding value, which seems to be more of a problem in fiatlandia rather than bitcoinlandia, yet still returns are not guaranteed yet we can take precautions to lessen our withdrawals during periods that the BTC price is less than 25% higher than the 200-WMA (if we so choose - which may be prudent).  

For sure as the BTC gets withdrawn, the authorized amounts would get smaller in terms of BTC amounts, in the event that we held the withdrawal rate the same in terms of percentages, such as withdrawing at 4% to 6% per year.  Of course, the greater the cushion in a persons budget size, the more likely he should be able to feel comfortable employing higher withdrawal rates in terms of percentages, again as long as he would be valuating the sufficiency of the size of his BTC holdings based on the 200-WMA rather than based on BTC spot prices.  

I had previously used the backtesting tool, described as Simulation on the website to show that fairly high rates of withdrawal would have historically been sustainable... such as 6% to 10% and even higher, and I believe that I even used higher rates than 10% to max out the tool, even though the tool maxes out at 30% per year.. and you can even experiment with 30% per year and see that your BTC holdings hold up pretty well, especially if you might have reached a status of adequate (or over) accumulation even as far back as 2015 or earlier.  Do you think that I should go through those scenarios again and try to show how it plays out with the tool?  which I prefer to spread over at least a whole cycle (meaning 4 years) in order to really get a sense for how sustainable withdrawal could work (or be calculated in terms of reaching an adequate BTC stash size).

Maybe you want to give me some ideas of what you would like to see or otherwise I would come up with my own scenarios, if you  want me to show how to use the tool in terms of backtesting some kind of a withdrawal that spans at least over a whole cycle... so for illustrative purposes, the latest date that we could start would be 4 years earlier than today, which would be late 2020...yet we could go back further, too.


I understand why you mention 30 years, since frequently in traditional financial circles, investment advisors will describe 30 years as a kind of target timeline for withdrawal of funds, even though to me it seems that any kind of withdrawal rate should be sustainable in a perpetual way, and not necessarily limited to 30 years, so therefore, there should be no need to have to be OLD in order to start to employ sustainable withdrawal as long as you conclude that you are ready to begin based on your stash size, whether than is 10 BTC or some other amount that you might have had achieved (talking in terms of hypotheticals rather than the holdings of any particular forum member).

And so frequently we are going to want to employ a withdrawal rate that averages less than the rate that our holdings grow in value.  So surely, I am not contemplating any system that unnecessarily depletes the principle of our BTC holdings, and for sure, I would rather than guys error on the side of conservatism in their withdrawal until they are sufficiently comfortable that it is going to sufficiently hold value in terms of their assessment of its valuation, yet it seems that anything at or below a 4% withdrawal rate would be quite conservative, and perhaps NotATether's suggestion of a 1-2% is overly conservative, and his suggestion of such a low withdrawal rate may well mean that he figures that he has not quite reached a status of overaccumulation of BTC to justify employing sustainable withdrawal including that he still wants to continue to build his BTC holdings, and 1% - 2% annually may well be so conservative that it may well work against his best interest, unless for some reason he is still wanting to grow his bitcoin rather than withdrawing from his BTC in a meaningful way in which he can know that he has already reached an over accumulation status.  

Again, I have no intention to talk about the actual BTC stash sizes of any particular forum member in term of figuring out what might be considered overaccumulation or the employment of a budget that I believe would provide of sustainable withdrawal, whether we are talking about 1 or 2 BTC or 10 BTC, or 20 BTC or some higher quantity of BTC as our speculative budget.


This part is likely true, especially if guys are valuating their holdings based on the 200-WMA rather than valuating on BTC spot prices, which can be quite erratic, as many of us have surely witnessed over the years.

By the way, I have looked at the forum registration of each of you guys (@Poker Player and @NotATether) and surely each of you have been through a whole bitcoin cycle, yet it still can be difficult to presume that merely 4-5 years of BTC accumulation would put a person at a point of overaccumulation of bitcoin, so I can see that, contrary to my earlier suggestion, neither of you would have had gotten to over accumulation by 2019 or 2020 unless you either greatly front-loaded your BTC investment or you had begun investing into bitcoin several years earlier than your forum registration dates.. and sure.. yeah of course anything is possible, and so maybe we could look at scenarios of BTC accumulation between 2018 and 2022 and then start our withdrawal strategy in 2022, yet that would still ONLY be 2 years of withdrawal, yet surely I am open to proposals in regards to hypotheticals that either (or each) of you might want to attempt to visit (and/or bat around in terms of sustainable BTC withdrawal ideas).

The rule is originally intended for people who are retiring, so that the money could last about 30 years. If you haven't reached at least 60 maybe that's why it seems high to you.

Although I personally don't think the same. Bitcoin will continue to grow above inflation, well above it for many years, so with 4% or less you will not only not run out of money, you will continue to gain purchasing power.

0.03 BTC sounds very high even for a 10 BTC budget.

It may be just me, but I have an even lower percentage withdrawal rate, somewhere between 1-2% a year.

Keep in mind that my own ideas regarding withdrawal or sustainable withdrawal, whether based on price or based on time, presume that the person had reached a status of over-accumulation.. or alternatively using a set budget, for example giving a 10 Bitcoin budget to a business, then if the business were to be using a time-based withdrawal system, then the business could figure out its withdrawal rate, and so for example the tool currently asserts that a 4% annual withdrawal rate would be 0.03333333 BTC per month, even though surely I want to adjust the tool so that it would use the 200-WMA dollar value, yet we have not yet made such adjustment, and then perhaps be able to withdraw up to 10% based on that way of valuating the BTC holdings, yet we have not yet made those adjustments... so until we make such changes, it may well be better to stick with more conservative withdrawal rates of around 4-6% annualized.

This is very impressive and commendable.
Sincerely speaking, you guys are doing perfectly great job to make Bitcoin more vulnerable and I hold you guys in a very high esteem for your tireless efforts and the significant energies you are putting to ease the process of Bitcoin withdrawal.
The work is excellent and I really appreciate your incessant it.

I think DCA is more about learning how much return Bitcoin has given in past years on specific amount. Like if someone has invested 10$ per week for 5 years then there are tools already available that can tell you how much profit one has gained. Based on that historical data one can adjust his investment strategy for DCA.


Signature campaigns are not only DCA for the account owners but they also provide an easy way for persons to acquire Bitcoins specially in areas where buying Bitcoin is forbidden for different reasons.   

In regards to accumulating BTC, from my perspective, there is a really BIG shortage in BTC holders, and the reason for that is because they are spending too much time waiting and not enough time acting, so I cannot see any tool to be helpful in terms of helping guys to engage in more strategizing than they already tend to do in their BTC accumulating process journey.

I also believe it is not correct to say that people who each have 10 BTC is the correct comparison, even though technically you are correct, yet I think that the main issue is that there may well be guys of more or less equal means, and some of them are more aggressive in their BTC accumulation than others, and surely it pays to be aggressive, and so part of the point is that one of the guys is going to end up with more BTC than the other, and the sooner he gets started accumulating BTC, the more he is likely to accumulate, yet there still can end up being cases where a more aggressive investor will be able to catch up, even if he comes to BTC later. 

In one of my posts within the past week, I attempt to outline those kinds of examples in one of my posts in which I compared the examples of three different guys, and to try to show their main difference was their level of aggressiveness and when they found out about bitcoin

This is very important. I agree 100%.

The average cost simple doesn't matter. It is an imaginary number in our heads, which has zero consequences.

How much BTC you have (or any other asset) is much more important than how much you paid for it.

If you have 10 BTC now and I have 10 BTC now too, it doesn't make any different if my average price is lower or higher than yours. They are worth the same.

We should never try to guide our decisions based in average prices imo.

Surely there are several factors to account when establishing your BTC position - and the earliest of BTC accumulators probably should be accumulating at any price until the start to get a certain level in which they might be able to be more selective.

I probably would not want to be involved with any kind of tool that overly attempts to strategize in regards to when to buy bitcoin, since my frequent suggestion is to attempt to be as aggressive as you can in regards to investing into bitcoin without over doing it, so even though I am not opposed to the theories of holding back in order to buy on dips, yet from my perspective, there could problems for either suggesting waiting to accumulate or advising to wait to accumulate.. so I am not too excited about anything that might contribute towards waiting.. even though I do understand and agree with ideas about having some money available for buying on dips.. and I also agree with front-loading, even though it can be difficult to know when to engage in any of those kinds of behaviors except for being able to appreciate that you might not have enough BTC so there can be various strategies to employ to attempt to increase the likelihood of accumulating more BTC.. .... but then maybe I have another concern that it is more important to have more BTC even if you had to spend more per BTC to get it, rather than having fewer BTC..

Would you rather be a guy who has an average cost per BTC that is ONLY $1k per BTC, but he ONLY has 2 BTC? or a guy who has an average cost per BTC that is $10k per BTC but he has 10 or more BTC?

One of the things that seems to make bitcoin special is that it is an asset that is amongst the best, if not the best, asset that is widely available to the whole world's population, so a goal of accumulating as many as you can within your own means of gathering seems to be more important than figuring out your average cost per BTC... while at the same time, once you established enough and/or more than enough BTC within the bounds of your assessments of your needs for cashflow, then you can start to use these kinds of sustainable withdrawal tools and perhaps even largely continue to hold your BTC and allow your BTC holdings to continue to grow (at least in terms of dollar values) since the tools might allow you to figure out ways to strategize your sells in either such a way that you don't have to sell as much or alternatively pace your sales.. ... I still have not completely figured out a way on a personal level to completely use any of the advance month sales because it frequently is not going to feel good to sell large amounts of your BTC unless you are starting to feel that the BTC price is getting into territories of over-exuberance, and I am not even going to concede to knowing when that is going to be, so each person would need to figure out the extent to which s/he wants to sell months of withdrawal authorizations in advance.


I find those DCA tools to already be very good tools for figuring out where a person would have had been if he had followed a certain level of strict DCA strategy, even for some period and then selecting another period and then doing some of the math ourselves in regards to if there might have had some periods of lump sum in the buying period or buying dips.

So sometimes we might be able to see where our actual bitcoin holdings are, versus where our holdings would have been or could have been if we were to have had followed some other strategy... and sometimes even being able to see if whatever we are currently doing is competitive with some kind of a strict DCA strategy or if we might have over-performed or under-performed such a strategy.

The tools are likely ONLY going to take us so far.. and surely one of the advantages of already having had established a BTC stash that might be enough or more than enough is that either this sustainable withdrawal tool, or even my raking tool, can help to give us ideas in regards to how to reasonably manage the stash that we had already established. .and if we had been investing in bitcoin for several cycles, then it becomes more and more likely that we are going to be in sufficient profits.. which is another problem with considering merely simple profits, and from my own point of vies simple profits do not make very much difference, since sure maybe we can sell some of our BTC based on merely being in simple profits, but if we build and hold BTC profits for several cycles, it becomes more and more likely that our BTC holdings will already start to be in a kind of status of compounding profits, which additionally justifies the employment of a sustainable withdrawal status that ends up likely taking advantage of the ability of the BTC holdings to continue to compound in value... ..

but then again once someone might be in the process of actually wanting to sustainably withdraw from his BTC stash, he may no longer be as concerned about compounding value, but instead more appreciating of the fact that BTC prices (especially measured by the 200-WMA) are continuing to out perform traditional investments which likely justifies the abilities to employ withdrawal rates that are much higher than if he were to keep his value in traditional investments, so surely it is becoming more apparent to me that a 10% withdrawal strategy has good chances of continuing to be sustainable in bitcoin, which largely means that a guy in bitcoin may well ONLY need to have $800k in bitcoin as compared to $2 million in traditional investments (again measuring by the 200-WMA is currently a reduction from around 60.8 BTC to 24.3 BTC.  each of them would constitute around a $6,666 month withdrawal amount... yet having the value in BTC likely causes the lower amount of BTC to be more sustainable than if the higher amount of BTC were sold into dollars and surely of course, since the current BTC price is a bit more than double the 200-WMA, then around 30 BTC could be sold right now to get the $2million fuck you status.. . .and maybe include having to sell a bit more for taxes.. (maybe 36 BTC), so then if the guy is walking away with $2 million in cash then he would presumptively need to invest it somewhere in order to get the 4% withdrawal rate and/or the $6,666 per month of income off of that.

I would feel much more comfortable having 24.3 BTC in BTC and using a 10% withdrawal rate in order to get the $6,666 per month of cashflow perpetually and in a sustainable way based on bitcoin's ongoing expected growth rate, and at the same time we can look at actual BTC's 200-WMA growth rate to attempt to verify if we are expecting the amount to come down and/or if our anticipated ongoing 10% withdrawal rate is continuing to be sustainable.

Well, it would be nice for people to see how much money they made a profit off of their DCA strategy if you input the day month and year they've start buying it (or maybe just the month and year but that would not work very well because of the volatile BTC price). You could even make a little graph that shows how much in the green (or red) their investment is in, similar to https://hodl.camp.

When discovered btc I didn't do any btc. I used other investments to buy it.. I reallocated in very few months (about 3). Thankfully, signature campaigns are somewhat of a DCA for me.

But a typical dca strategy is nice.

There could be some interesting relationship between how much you should invest and the current 200-WMA.

Maybe at high levels of 200-WMA,  no money should be invested at all? Or just a very small amount.
And when the price is very low, the investor should make an effort to invest more (the money he didn't invest when 200WMA was very high.)

Bitmover, I just realized that we might also need a DCA strategy tool for buying bitcoin But that would depend on many things like your current income and what percentage of it you would like to spend.

In addition to that, maybe it can even have some sort of dynamic DCA that looks at moving averages which will influence the amount of bitcoins someone will need to buy.

Good job done bitmover. Hopefully it will work, if coingecko is providing past data for free. There are many users who keep an eye on that tool very often because quick glance of Bitcoin spot price vs 200-WMA and the Bitcoin withdrawal strategy. Hopefully in few days things will get more clear about the new fix.
Everyone can fix the issue with paid plan but you fixed the issue using this novel approach. Kudos to your effort.  

Tool is back online.

I was able to continue using coingecko.

As coingecko allow up to 365 days of historical data in their free plan, and as historical data is static, I just downloaded all historical data.

I also made a small code to check for changes in the last days of their free api plan. So, it will theoretically update our downloaded historical data once a day. Looks to be perfect. let's see in the next days if it updates well!

Thank you for sharing this discovery.
Sometimes we are looking for an API to collect some data more easily, and it is not easy to find something free.

I will save this link and analyze it for future projects. 

Ok. great.   Hopefully one of them ends up working for us, and is satisfactory...

Website maintenance  takes some effort. Ddos and broken API in less than a month!

I discovered some free api here:
https://blog.rmotr.com/top-5-free-apis-to-access-historical-cryptocurrencies-data-2438adc8b62

I will take a look and setup one this week!

Yes. .I noticed that I was getting spinning beachballs, and I was hoping that it was merely a temporary glitch.. and maybe there is a certain rotation that happens with the data sources from time to time... and too bad about these kinds of set backs when the data was showing a lot of informative dynamics that so far are not very capturable in other locations.

Hello JayJuanGee,

You may have noticed the page is broken. I was getting data from coingecko, and they decided to close their API.


I will look somewhere else for a free bitcoin price data API...  maybe someone has a good suggestion? Maybe binance (this is probably the easiest choice, BTC USDT data from binance)

I have stored locally price data from 2010 to 2021  

I am not sure if Paintbrush will help because I am talking about the same categories for the simulator. 

% withdrawal, stack size and start date.

In other words, the simulator should run separately from the current.. authorized withdrawal amount.

Edited: O.k.  Below I added a paintbrush example.

Don't get me wrong.  I like the information that is being provided, and I can still figure out both historical and future projection matters because I know what I am looking for, but there can be a bit of confusion for a new person coming to the tool regarding when we are projecting a sustainable withdrawal rate from here into the future to provide an authorized amount to withdraw versus if we are going to project from the past to the present through the simulator.

So for example, if we use $2 million as our default entry-level fuck you status, then right now, I can look at the tool, and I can see that today it takes 62.6 BTC in order to be at FU status (based on the 200-WMA valuation).  However, on June 1, 2019, I needed 537 BTC in order to be at FU status in terms of dollar value and the 200-WMA on that date.

As the below image shows if I want to back test the tool, then the 537 can go into the tool and it shows that withdrawing at the most aggressive rate of 30% annually will reduce the stash down to 124 by today.  This analysis works for someone who is looking at himself having a larger stack in the past and spending down to his current BTC stack size.. but if we currently have not yet reached our fuck you status or close to our fuck you status, we should be forward looking and not backward looking. even though the backward looking tool provides valid information.. to see how a person might have spent his stash down. but it does not do anything to tell us how many BTC we need right now.

Many of us who are still building our BTC stack size are considering how many BTC that we need now or into the future in order to be able to start to use the tool, to start withdrawing under the parameters of the tool and potentially to keep our BTC stacks sustainable in terms of their maintaining their dollar value in order that we can continue to withdraw without depleting our principle, in terms of the dollar value. 

The tool does not help us to backload our current stash in terms of BTC value because that question is mostly irrelevant.. our current BTC stash is too small in order to work in the past, but our current stash will work into the future as long as we have 62.6 BTC now, when we needed to have 537 BTC on June 1, 2019 in order to be in the same place.

So yeah, if we are going to look up the history, then we can put the equivalent number of BTC into the stash in order to use our fuck you status dollar value, but we should be putting that into the simulator side with the 2019 date and not into the current date if we were going to project forward from here versus projecting from the past to here, since the current date only projects from here forward and the stash sizes would be different.

Ok.. here is a Paintbrush illustration that shows examples of separate and independent inputs for each of areas... note an ability to put a different stash size and withdrawal rate added to the simulator input area.