Topic: DCA, the most convenient way to increase your bitcoin as an investor. - page 2. (Read 1953 times)

Ahh..JJG, you are very early to bitcoin since you started your investment journey since 2013. I first heard about bitcoin 2017 and in 2018, I decided to know about bitcoin and I made research but couldn't get any encouraging information on how to go about my bitcoin investment because I never knew that I could start with very little amount. I got discouraged when I thought it was only through trading one can make profit from bitcoin because I know that it will be very complex and how will I go about it since I was working, so I erased the passion of knowing more about bitcoin or how to have bitcoin from my head because at that time down here in my country, it was difficult to know how to go about buying bitcoin.

In 2019, a friend of mine introduced me into altcoins but I told him that I needed bitcoin if possible and he deceived me that all cryptocurrency are the same and I fell for it and run at loss after the project crashed. It was in 2021, during the bull run that I got more attracted to bitcoin and made all necessary researches which through someone I understand how to buy bitcoin and I bought my first bitcoin then but couldn't hodli because I lack the proper knowledge on how to go about my bitcoin investment journey.


Becoming a member in this forum has really helped me a lot in my bitcoin investment especially this thread because I was able to learn a lot from you and other regular posters on this thread and I am pleased with the quantity of bitcoin that I have accumulated since then till date, and I am still accumulating regularly every week which I intend to keep doing for a very long time. I started buying bitcoin at $21k price in late January 2023.

I am happy that I am using the DCA method because there is power in it because it is small but mighty overtime.

Many people missed investing in Bitcoin early on because they were unsure or afraid. Those who had money but did not invest did not believe in Bitcoin potential. But we can learn from past mistakes. But Investing little at a time means DCA is still good idea. Investing steadily can make up for missed chances.
By the way do not worry about past mistakes. Focus on Bitcoin future growth. Investing steadily can help you build good amount of Bitcoin over time and feel better about missing out early.

It's not compulsory that you must DCA with a fixed amount as long as you are earning money and you are using some part of that money to buy bitcoin. That's totally fine.
 
There are times when you might have very high spending months in which you will have little left with you to spend on bitcoin investment, so at that 's totally fine, which you can also increase your monthly buying amount. It all depends on your finances at your point of buying.

From what I am reading within your response, so far, is that there are not ONLY objective limitations involved in our assessments about "what we can afford to lose" but also several objective limitations too that even involve how convinced we are about the investment thesis of the asset (in this case bitcoin) as compared with other places that we might be able to put our money (investments or otherwise).

Surely there are levels of complications of anyone's financial life that become more complicated if a person has to support a family or even if they have a business with uncertain cashflows.  The more complicated our financial life and our obligations, the less that we are able to set aside cash for investing 4-10 years or longer.


DCA involves whatever amount that you have available, and so what are we talking about when we are talking about early days?  You want to do two cycles or more? Two full cycles would put us at September 2016.  And, maybe a reasonably small amount could be $50 per week?  If you invested $50 per week over the last 8 years, you would have had invested ONLY about $21k, yet you would have nearly 3.8 BTC, so yeah, it might not exactly be fuck you status levels of money, yet that is partly a choice in regards to how aggressively a person might want or be able to be in the event that they could have had higher levels of investment based on their discretionary income or not... Of course, you can keep those dates the same, and adjust the numbers up or down in order to figure out what a reasonable budget for you might have had been... so doubling the weekly DCA amount to $100 would double the amount invested to $42k and the amount of BTC to 7.6, and surely those are not bad places to be.

Of course, if we go back to your own forum registration date of July 2011, we could lower our investment amount to a mere $10 per week and be rich as fuck from that kind of a timeline and those kinds of relatively modest DCA amounts.  That would be well more than 142 BTC for only $4,700 invested.^** 

**The calculator only allowed me to calculate 9 years at a time, yet most of the performance of the investment comes from getting into the investment early.


Well?  Now you seem to be talking about late 2016 when you are referring to starting from $600.  I personally consider that there were more and more onramp options available with the passage of time, and depending on your location would affect which kinds of options were available and the extent to which they might be cumbersome to set up.


The attack vectors have changed over time, and surely some threats now are less relevant as compared to some of the older threats, but threats still exist, especially Sim swaps and social engineering.. and maybe even the various kinds of attacks from regulators regarding restricting on/off ramps, self-custody and threatening KYC creates other kinds of attacks that could still undermine aspects of the strength of bitcoin's investment thesis, yet from differing angles.  For sure, even though institutions are getting more involved, Bitcoin is not free from attacks and/or risks...including poor people sometimes needing to be concerned about how to manage their UTXOs if they might be wanting to employ a lot of lower cost transactions on the blockchain that might become unspendable at certain points in the future.

Or even the ways that mining pools are currently operating contributes to a certain amount of centralization risks in bitcoin.


Yeah, if any of us leave our coins with third parties, they might be risking our coins, yet also the ways that third parties take risk with other people's money can also screw up the price for others or even contribute to changes in the whole bitcoin ecosystem in regards to regulations and supposed ways that regulators may be proclaiming to be wanting to "protect" us.


From when did you miss out on investing into BTC, Sim_card?  And from when did you start getting serious?  or more serious about investing into bitcoin?

I recall in about September, October, November 2013, I had been researching into various investment related products because I was trying to figure out ways to diversify away from some dollar investments and to supplement some of the 401k investments that I had.. so I had some bitcoin related tabs in my browser that I did not look at until I was sparked from a conversation with a guy in his early 20s who had more or less gotten quite a bitcoin windfall because he had bought around 27 BTC in mid-to-late 2012, so then when I was communicating with him in early to mid November 2013, I thought that he was a bit of a goofball in regards to investment ideas and cashflow management ideas, even though he had made out like a bandit in regards to his bitcoin investment.. which each of his coins had gone from a few dollars to $600 and then to around $1,100.. .. but still that got me motivated to look into bitcoin more and within a week or two, I started buying bitcoin (pretty much at top of the late 2013 prices), yet my initial BTC buying plan (and self-authorized budget) was for 6 months of buying and then to reassess.  So my missing out seemed to have had been mostly just that 2-3 months period that I had bookmarked some bitcoin related pieces of information, yet I did not follow through by actually looking into the matter until after the personal story of the guy had gotten me motive to look into it.

The fact is that you did not invest in bitcoin those early days is because you don't believe in bitcoin and that was why ypu could not take the risk because you said that you kept the money which means that you still have an amount that you can afford to lose but you don't trust bitcoin price going upward trend.

A lot of us have made mistakes in the past and neglected to invest in bitcoin due to ignorance and lack of understanding the potential of bitcoin and it is bringing regrets now but as long as bitcoin price is cheap using DCA will help us accumulate gradually, slow and steady to reach a good bitcoin size in order to console ourselves from missing out the early days of bitcoin.

I think there is semantic scope inherent in the saying "don't invest more than you can afford to lose" than in its most literal sense. This is important because I fully agree that bitcoin is amongst the best asymmetric bets. When you are young, you have no children and no serious obligations to fulfill other than your basic needs, then there is some scope for additional risk taking and I think there can be scenarios where you feel very convinced that the odds are in your favor while the remaining downside risk would really hurt if it were realized.

Bitcoin is one of these things that when I came to find out about it for the first time, I thought this is going to be huge one day, but I wasn't brave enough back then to risk money that I rather kept because I wasn't sure whether I could really afford to lose it. I did have obligations back then. If I didn't, I would have been far more willing to take risks. Including risks that back then may have made me be a little afraid so to say.

Now this is not trying to argue against your point of view that acting with caution and as much rationality as possible is the right approach. It is, but sometimes a very unique door opens in front of your eyes while you are not set up to put serious money into it. Now I know that DCA from the very early days on would have generated a fortune even with small amounts on a weekly or actually monthly basis. But the truth is that bitcoin was such a different thing from all other investment opportunities that hardly anyone could be fully rational about it. It was quite an adventure back then because it was literally impossible for the average Joe to see and understand whether there are bugs or backdoors or what the weaknesses are of such a network. I would argue that the chances for bitcoin to go from 60k to 600k today is at least as high as bitcoin going from 600 USD to 6,000 USD back then because it stood the test of time. The network accumulated so much value that most likely the best hackers in the world already tried their luck and attacked the network from whatever angle they might have seen an opportunity. That is something nobody really has to be afraid about today.

The ability to cope with a loss is a function of the ability someone has to dig their ways out of a hole in case of a bad outcome. It is not necessarily the cash someone has in the bank. That's where everyone should be realistic about their own terms. Can I somehow cope with the risk I am taking? I think one very important aspect to consider is whether second or third parties would be affected if someone decides to take a risk. Of course nobody should force themselves into insolvency risk taking behavior, but there might be a few occasions in life where shifting the boundaries at least somewhat can make sense. Maybe EV (= expected value) plays an important role as well.

Maybe you are overinvested Moreno233.  You have to account for the fact that you could lose everything, sure the odds might not be high, but you have no guarantee of profiting or not losing your investment, and part of the reason that there is expression to NOT invest any more than you can afford to lose, that is to make sure that people are not investing from either their disposable income or money that they absolutely need... so if you are expecting that you need some portion of your bitcoin investment, then maybe you need to diversify into some other investments so that you don't have everything in one basket?

Sure,. everyone is supposed to be choosing their investments in such ways that they feel that they are more likely to be better off by investing into their chosen asset class (in this case bitcoin) as contrasted with if they had not invested.

One thing that we know about bitcoin is that so long as you don't use leverage, then the most that you could lose by investing into it is up to 100%, yet bitcoin remains amongst the best asymmetric bets to the upside, meaning that bitcoin has a lot of upside potential. .but it still is not guaranteed.. yet people can still have very good odds of profiting stupendously even from a relatively modest investment.. yet I frequently suggest that people (in fact everyone) invest into bitcoin as aggressively as they are able to do without overdoing it, yet that still does not mean that bitcoin is guaranteed to pay off, to be profitable, not to lose value and/or not to go to zero.

So each of us has to figure out our investment size and realize that bitcoin is not guaranteed to play out better than if we had not invested into it, so that means we might have had been better to have had not invested into bitcoin... so hopefully you figure out some ways to balance these kinds of ideas in your head in such a way that you choose an investment size that is appropriate to your finances and your psychology including accounting for some possibilities that your bitcoin investment may be a loser or even go to zero.

But, hey whatever, if you want to live in a fantasy and presume that bitcoin profits are guaranteed, then that is your choice.. it just does not seem healthy to me.. but whatever, you do you.

You mean you can afford to lose your Bitcoin portfolio? Wow you must have just put a tiny fraction of your money in Bitcoin and just so you answer a Bitcoin investor when you are not really serious with the investment. If I may ask, since you invested only what you can afford to lose into Bitcoin, where did you invest the rest of your money that you cannot afford to lose? I will love to know that investment opportunity you have so much confidence in and believe it can never fail, the reason you chose that over Bitcoin.

I don't believe in investing what I can afford to lose because I cannot afford lose the entire portfolio I spend several months building through the DCA method. Even though I put in small amount of money per time, it is something significant for me that I cannot afford to lose same, the reason I guard it jealously, using a wallet I control my keys. What I only do is to invest amount that I can hold for long without being under pressure to sell. I do this by investing after I have sorted out my basic needs and also set some funds aside for any emergency.

This as been the best way to generally invest in crypto. But this looks more accurate when investing in good coin like Bitcoin. Also, using DCA only doesn't make up all the strategy here. Patience, patience and more patience make it work well. This is why it's always the best to invest ones own money and the money one can avoid to lose. Although, investing in Bitcoin may guarantee good returns but this may not come in years. This make patience highly important in the space.

Because it works better and brings profit for most of investors who use DCA strategy. With DCA, it's more easily to succeed and get profit, because it requires simple steps and principles to follow. You don't have to play with technical indicators for any analysis. What you need is researching about fundamentals of Bitcoin, and the rest is going with DCA strategy.

To learn fundamentals of Bitcoin, here

The bullish case for Bitcoin.

DCA, is the most convenient way to increase your bitcoin as an investor. It is and it has already been proven by many investors and so many people already know it. But to be honest this is the best method not only for newbies but also for experts.

DCA is a good strategy for investors with lower risk tolerance. Investors who put a lump sum of money into the market at once, run the risk of buying at a peak, which can be unsettling if prices fall. The potential for this price drop is called a timing risk. https://www.investopedia.com/articles/stocks/07/dcavsva.asp

Even exchange nowadays has a feature that allows investors to buy bitcoin at set a time.

DCA Strategy, Spreading the budget out on a scale with purchases that are sorted as planned. Investors will easily apply the DCA strategy sustainably in their investments, they budget a few percent of their salary to buy Bitcoin. The advantage of DCA is that it does not make someone stressed because they only invest a small portion of their salary at each stage. Makes it easier for them to set the purchase tempo if done every week. Maybe DCA is more popular than other strategies because many investors prefer to use DCA compared to other strategies.

Pardon me but I have not see this type of DCA approach that is only done on financial uptrend. The much I know is that DCA is a continuous buying method that is done irrespective of the market condition and the essence of the DCA method is to enable the investor plan the investment in a way that it will not have much financial burden on him that is why you buy small part of the funds per time and spread over a regular period of time. With proper planning,  even during period of financial downtrend of the investor, the DCA method will be continued because the investor would have already figured out the funds for basic needs and also set aside emergency funds which serve as protection for the investment to prevent the investor from selling his asset unplanned. Therefore, the DCA is suitable for all market conditions and all income classes.

How your income comes in is a a very good indicator and probability of your bitcoin investment to last long using the DCA strategy. The DCA strategy only works for bitcoin and this is not that other crypto can be used for the same purpose as bitcoin will. You should differentiate them when explaining so that newbies won’t think the same strategy that works for bitcoin will also work for other cryptocurrencies.

A flow of income is a good sign that your DCA strategy will last long and you won’t have any problem when accumulating from time to time. You can always adjust the amount to spare while doing the DCA as you’re investing in them base on how the income is coming. This is not a problem as long as the DCA method will still be actively going without any hinderance or purpose to take from your portfolio.

As long as you have a stable income and discretionary income you can use part of yoir discretionary income to DCA regularly in order to build and vrow yoir bitcoin investment. However, everyone wants an kncreament in his income and it will be good if along the line as your DCA is ongoing, you income increases because it will give you the opportunity to increase the amount of money that you are using to DCA in order for you to reach your bitcoin target fast.

Normally DCA is always done on a financial uptrend because that's when there will be a little surplus of money for the person to use and buy BTC and stack without looking back to whatever they are supposed to spend money on. 
 
Having a downside cash flow will definitely minimise how much the person will have to spend on their expensive if it will even be enough to cover up daily expenses. Talk more about how much they care to spare to spend on DCAing Bitcoin.

Depends of what you have any amount should be fine to start your accumulation journey by using DCA strategy. Although it will give you an advantage if you have a lot of balance to spend but anyone could able to start on what they are capable to spend. Also DCA is not for short term most likely you cannot feel the result with that matter. You should aim for long term with this since it will give you more positive result in long run.

Those who are thinking to gather short term profit are traders although yeah there are situation that they can gain profit, but they are putting their selves on more higher risk especially that they are dealing with volatile price of bitcoin. So much better erase those thoughts about trading but rather spend some time to learn and understand DCA method since for sure you will find that this is more better investment to choose rather than engaging on any high risk to lose money activities.

I think DCA should be done more or less with the upward trend of cash flow as it allows to build up more bitcoin holdings in a short period of time.

We have a lot of cryptocurrency in the World but only one of them is king with great potentials which is bitcoin and bitcoin is that coin that will survive in the future and most shitcoins will not . Thos is why only bitcoin is worth to DCA on so that you don't waste your time and resources. One van have a good job and still not invest in bitcoin what matters is for that investor to have the belief in bitcoin that it is worth throwing some value into for the future so that the person will be able to look for a means of having discretionary income to invest in bitcoin regularly through DCA.

DCA works for bitcoin and not for crypto or shitcoins, so hopefully you are able to clarify what you are talking about.  If you are talking about bitcoin, then why use the vague and misleading term that refers to shitcoins, or that maybe you don't know the difference between bitcoin and shitcoins?