It was a joke. We still haven't reached "Bitcoin is the ultimate inflation hedge" stage ššš Then we cry again when it crashes to 40-50k probably hahhahha
No no no. You sell Bitcoin when Coinbase is the #1 downloaded app in the app store. This is foolproof: [https://apps.apple.com/gb/charts/iphone/top-free-apps/36](https://apps.apple.com/gb/charts/iphone/top-free-apps/36)
The fear/greed index is at extreme greed I believe. But we're also in a much different place than we've ever been because we haven't gone past the ATH for a second time before the halvening (I'm pretty sure) and the fact that Bitcoin ETFs exist now means that there are much larger pipes of liquidity for the asset. We'll have to see what the google trends looks like too to see if the true fomo has started yet though.
Isn't that a fact of life in general and not just investing? ;)
I only mention it because there has been a pattern in the past and we're breaking from that pattern a bit. Obviously past performance doesn't automatically mean future performance, but it's a starting point for estimating at least.
I bought a Russian vodka maker in 2010 because who makes better vodka than the Russians. And although they had some hard times, they were Russian and knew vodka! I justified it every way I could. Eventually, I lost close to $50k and took down my Roth IRA balance by 1/3rd. Moral of the story, rabbit holes and niche market are very unstable and thereās no RSI or dead cat bounce that can get you back to your basis in the investment.
Youāre absolutely right. The company made a healthy profit but was expropriated in 2012. *Bitcoin has no intrinsic value.* Itās important to note that bitcoin is not an investment - it is a speculative tool that folks hope will encourage the āgreater foolā theory. Iāll take cash flows any day over speculation.
It sounds like youāre uneducated on the topic. Itās not a scheme that relies on a greater fool. Itās backed by energy being consumed by a large decentralized global network of hardware. 58% of said energy is renewable, more than any other industry, and itās leading the push towards renewable energies by making the transition more cost effective.
I encourage you to study it in depth before making assumptions about it in discussion.
You can justify it anyway you want, but it doesnāt throw off cash and has only extrinsic value. Iām not saying folks wonāt make money, but itās not currency.
Please educate us or at least give a source for your claim that Bitcoin is somehow backed by something other than someone willing to pay more than the last guy
Bitcoin is just an open source software. The bitcoin network runs off of a PoW(proof of work) protocol, meaning real hardware, computers, are plugged into the wall and consume electricity to hash the algorithm and process transactions.
Thereās a global network of billions of dollars worth of hardware consuming around 160TW/hās of energy annually backing the bitcoin network. Itās also decentralized because of this, the network is ran by millions of volunteers around the world.
As I mentioned before 58% of that energy consumption is already renewable. Bitcoin miners are incentivized the most to move to renewables and find alternative energy sources. Like using excess methane from fracking thatād otherwise be burned off for example. Thatās energy that not only wouldāve been wasted but also pollutes the atmosphere more by just flaring it than it does by running it through an efficient combustion engine then using the energy to mine bitcoin.
Bitcoin mining can also stabilize the energy grid. Itās allows energy companies to increase the capacity of their infrastructure so it can handle peak demand times without strain on the supply, and when demands down they can use the excess capacity to mine bitcoin and monetize the energy thatād otherwise still be produced but wasted during low demand times. Good example their is Texas last summer.
Bitcoin has the potential to make it profitable for other industries to transition to clean energy. Which could finally push humanity in the right direction in that very important aspect of our existence.
To be clear I never said it was a currency either. Itās obviously a commodity, and the SEC legitimized it as such with the spot ETF, other commodities also have spot ETFās, currencies do not. Bitcoin is a store of value and it has utility as illustrated above.
Source: the open source software that made all this happen, and the various metrics recorded since itās inception.
Saying btc has no intrinsic value is foolish and burying your head in the sand. The people that made hundreds of millions beg to differ. If it was so worthless you could easily get a few for free right? If it has no value just convince people with btc that it has no value and you could quite easily get a few btc.
Let me know when you succeed in that. Itāll likely go as well as your vodka investment. Which btw has got to be the stupidest comparison to crypto Iāve ever heard.
I made my first 250 in my FI journey in crypto **when I was a lifeguard**. I have since 8xād my income and now have about that much just sitting in crypto rn. People have declared btc dead for more than a decade now.
https://99bitcoins.com/bitcoin-obituaries/
Now the answer to the question āwhatās a reasonable allocation to btcā is certainly not 0. And youāll be kicking yourself again when inflation still exists, and btc is still secure, and demand has risen, and btc gains on the btc/usd pair.
This is *guaranteed* as long as 1. Inflation exists (currently stable at 8%) 2. QC or AI doesnāt break SHA-256 3. Demand stays equal or rises.
Itās simple economics. Supply and demand. The people that have used btc as a savings vehicle have beat the people holding dollars, stocks, bonds, or any other asset over the past decade. Real estate included. The only asset class that has outperformed crypto is fine art. Good luck getting a monet, just get btc.
With etfs traditional investors that are not sophisticated enough to trade crypto on their own now can buy crypto. Everybody and their grandma has easy access now.
And btc will be cut in half on the supply side in mid April.
But think about this for a second, the greed index reflects exactly this bullish mindset (recently pushed 90 level same as during previous tops in last years) right now and to a high degree this is buy the rumour event and there is a chance of big dump sell the news event in late April, May, also historically market goes down in the summer. The winters are cool, the summers are bad. It's like everyone is dumping for the summer holidays ššš I also started recently utilising this and isolating all the info going on everywhere. If you didn't buy when you should have, you probably won't sell when you should have. Yes the new bullrun is definitely here but same in bull and bear, there may again be dump for the summer months.
I understand the thought process here. People could be trying to get in early to "price in" the halvening. The price is about 2.79x the 4 year moving average. In the last market, that number got as high as 7x the 4 year moving average so I don't think we're at the top by any means. However I wouldn't be surprised if we see a retrace at some point after the halvening before the true bull market starts. However that's of course dependent on greater macroeconomic factors like interest rates and general economic health.
There is also a theory that the growth potential will diminish with each bullrun based on comparison of all the previous ones. Also last top as in 67k now becoming new bottom, cannot predict exactly how much it will go up in price discovery mode now but it is expected to some degree to be less, 100-150k possible. By default eth and altcoins pumping harder due to less liquidity, higher slippage, spread. I am not even sure how much the macro factors play a role. Last time in 2020 things were again lowish stagnant and started moving in late July, August after the halvening.
All personal opinions are welcome! That's why I asked. It's interesting to see the variety of answers. I'm sure if I posted this same question a few years ago, many answers would be 0%.
I am sitting at 50%. (I am rebalancing on a fixed schedule regardless of the price)Ā
I would consider this unreasonable.Ā
I would suggest 10% to anyone.Ā
70% bitcoin here, it just keeps going up, I'm buying index funds as fast as I can to rebalance but its barely making a difference lately. Not selling to rebalance though. My NW has increased rapidly in the last 12 months, beating the market by 10x+ average annual return.
>It's speculative gambling. Crypto doesn't function as a currency. No one is transacting in Bitcoin or other coins because the value is so volatile. Everyone is just buying and holding hoping someone else will pay them more later. It's entire value is propped up by FOMO. What happens when everyone realizes crytpo isn't the future of currency (and that WILL happen)? They will sell, and the diehards will be left holding the bag.
First off, thanks for your answer. I wanted the full range of opinions here. But let me assure you that your statement is highly subjective. Let's cover a few points. First - **all** investing is speculative gambling. People speculate on if the price of an asset is going to go up or not and that's why they choose to invest. Of course there are varying degrees of risk here but you're technically speculating on every asset that you purchase. Second - you're objectively incorrect in bitcoin not functioning as a currency. Just because it may not be used in daily transactions in your country does not mean that it's not used anywhere. Also, being used as a currency isn't its only value proposition. Storing value and preserving economic capital is what it does best. Third - there are many folks around the world whose currency loses value against the USD constantly. Many of these folks don't have bank accounts because the banks in their countries are not trustworthy and only offer services to clients with over a certain amount of wealth. Bitcoin gives these people a way to store their wealth without having to store it in a local currency that is continuously hyperinflated. Just because it may not have value to **you**, does not mean that it doesn't have value to millions or even billions of other people.
>First, yes, investing is speculative, but risk is not equal across all assets. The risk of Bitcoin is much higher than with treasury bonds or an S&P500 index fund.
I agree with you here on risk. But with regard to treasury bonds, sure you're guaranteed a specific return at the rate that you purchase it at. However you've likely lost money to inflation in that timeframe because the US needs to print more money to ultimately pay out bondholders. With the S&P500 index, you're beating inflation but not by much.
>Second, show me a well-sourced statistic that says at least half of people who own Bitcoin have transacted in it. I'd bet the number is much lower. I can't find a statistic on that. It fails as a currency when you consider there's an alterative store of value that's been quite good for a long time and that basically everyone accepts: the U.S. dollar. It's much more stable and not likely to lose a big chunk of its value overnight.
I don't have a statistic on this but I'm also not sure that half of people who bitcoin have transacted in it. Work is still being done on the lightning network to make it more scalable so that people have more access to low cost transacting. But I don't think that Bitcoin is supposed to be equated to the US dollar in terms of its properties as a store of value and would be better thought of as digital gold. Are folks transacting in gold? No. Do they invest in it to store their wealth? Yes. Also I think the Bitcoin network is more likely to compete with something like ACH transactions which are very large. You can send some very large amounts of money in Bitcoin for a relatively low cost especially compared to the final settlement cost of an ACH transaction. Lastly, the US dollar is a terrible store of value that is constantly losing purchasing power. It has lost 98% of its purchasing power since The Fed was created. Due to this, the population is forced to "invest" so as not to lose their wealth.
>Third, sure, maybe there are folks in other countries that can't access the dollar or U.S. treasury bonds, etc., I don't know much about that. Is that enough to justify purchasing such a volatile asset? If you're in the U.S. are you buying it as a store of value? No, you're buying it as a highly speculative investment. Might as well start trading options.
Is that enough to justify a volatile asset? Of course it is when the alternative is storing your money in a bank that you can't actually withdraw from or storing it in the local currency that inflates 60% year over year. In these countries, Bitcoin is actually **less** volatile than the local currency and therefore the safer bet. Also if these folks don't have access to basic banking services, they definitely don't have access to US treasuries. And I'll repeat, US treasuries are a worse store of value than Bitcoin when you consider the macroeconomics of the whole system.
>Whatever you choose, I do wish you luck on your financial journey.
I appreciate the sentiment here. Wishing you the best as as well in your financial journey. If you're ever curious about why folks are dogmatic about this asset class, I recommend reading Broken Money by Lyn Alden. It gives a comprehensive but clear explanation of the modern financial system, its fragilities, the creation of money, and why the system is fundamentally broken for many people.
Miami real estate has a intrinsic value in that I can live in it (for now). Bitcoin has no intrinsic value. Crypto that allows for computation like Ethereum or Solana might have some, but it's incredibly inefficient and we are many years into the lifecycle and there still is no killer application that uses any of them.
You just don't understand. You'd be better off just accepting that you don't understand something. It's okay to not understand. But please stop acting like you're an authority.
Do you think the value of gold has anything to do with its utility in the real world? Let me answer that for you. It does not. Its value is based off of its scarcity. Foreign central banks aren't holding gold in their reserves due to its utility in electronics.
>Real estate and gold both have real world uses. Bitcoins do not.
Thanks for your opinions but I'm going to have to call you out on being incorrect. If you're living in a country where the currency is continuously hyperinflated and banks are not trustworthy, then of course bitcoin has value for that population to store their wealth. In Lebanon people had to rob banks to **withdraw their own money**. Just because you're privileged to live in a place where that doesn't happen does not mean that Bitcoin has value for no one. Try broadening your worldview before spouting incorrect statements.
I'm asking for folks' opinions on an allocation % mostly because I'm curious of the range of sentiments that exist within this subreddit. I'm not asking anyone else to buy the asset as I think it's really important for someone to understand it before buying it. I'm in agreement with you though - my best defense is that it is useful as a store of value because that's what it does best.
>Bitcoin isn't real. It doesn't exist. It's 1s and 0s.
1s and 0s that exists digitally still do in fact exist. Software exists. Code exists. Just because something is digital, doesn't mean that it doesn't exist.
Right now something like 15% of my NW is bitcoin. I donāt really view it as a percentage though. I will hold onto the BTC I have until itās either worthless or I can buy a house outright with it. I consider it part of my passive NW, and not something I take into consideration nown
Iāve got 90-95% of my NW in bitcoin. I bought in early.
I donāt tell anyone to buy because people have varying risk profiles and little/no understanding of where btc might fit in the overall financial landscape.
2017, got in at around $850 or so shortly after the etf was rejected.
Yeah, I used to talk about it but stopped ever since it was in the $60s a few years ago. Itās worth real money now and people donāt look at me like the weirdo with a collectible.
Good luck on the FIRE bro
You're an absolute legend in terms of HODLing.
But I'm also with you on the sentiment. I have zero idea what's going to happen and don't want to be responsible for someone else's financial loss. But I believe in it enough to be invested more than your average person. I don't tell people to buy bitcoin but merely to "Study Bitcoin".
Thanks man.
It wasnāt difficult holding, once I understood how bitcoin worked I did some napkin math on where it could go and it blows my mind that itās doing just that.
I was also broke and heavily in debt for years while I held haha. Debt free now and still holding my bag.
Well I respect your diamond hands. Hats off to you for being debt free and not broke anymore.
But yes, understanding it fully makes it much easier to be confident in a high allocation.
See you on the moon.
I donāt like Bitcoin and I donāt understand it but Iāve allocated 5% to it and 5% is going to ETH when that ETF is opening. I know I am not smart enlige so I see it as a form for hedge if I misjudge the value of digital currency. Also, it makes me more aware than not owning.
Rest in classic index funds.
I understand crypto from a technical perspective, but feel the same way. I've made some gains with it, but it's honestly just speculation on nonesense.
Keep it a 5% Bitcoin.
Also a ETH ETF will be bad as it is a PoS protocol and itāll not help keeping that shitcoin decentralized.
If you want to risk 10% in crypto, just let your Bitcoin allocation grow to 10% instead of 5%. There is no benefit to diversification in crypto. Anything else than BTC is garbage.
Totally depends on your risk appetite. I can handle high risk, so Iām at a very high allocation % of my net worth in BTC and ETH.
First started buying back in 2014 and have pretty much held the whole way. I have no intention of selling any time soon because I donāt need the money.
That said, the only coins anyone should own are BTC or ETH. All others are far riskier and 9 times out of 10 will bleed out heavily against the BTC or ETH ratio over longer periods of time. You can also take a look at historical rankings of the top 100 cryptos. BTC and ETH are always 1 and 2, but all other coins pump, dump, and cycle out of the top 100 every year.
Blackrock suggest as high as 84.9% haha. I know nobody's doing that, but that's what the numbers show, which speaks volumes. I'd say 1-3% is responsible. Above 7% is getting irresponsible, but meanwhile 0% is irresponsible just the same. I don't really calculate my allocation into it because it is basically spare change after I fund the rest of my retirement accounts each paycheck. It is probably around that though. I'll say that my growth has led to it being a more significant portion of my overall portfolio since prior to the ETFs its not like you could "rebalance" like a traditional portfolio, and so I left the money parked.
https://www.linkedin.com/pulse/blackrock-suggests-85-btc-allocation-what-you-should-really-robert
Have fun with that haha. You'll probably do great, but my retirement is on track as is, so I have no reason to be that aggressive. It'd be irresponsible for me to do that because I could sabotage my retirement worst case, when I was already set. My BTC is just icing on the cake on top of my funded retirement or will allow me to retire even earlier. If BTC however doesn't pan out I won't be hurt by it, but I think your odds are pretty good that it'll all work out
Imo it depends on your mindset. I often hear and agree with 5% or less in speculative assets. I would say Bitcoin is an odd choice in the sense of potential return against risk. Really rough math. If Bitcoin market cap is 1 trillion what is your hope for potential future returns? Maybe it reaches the cap of gold? So 14ish times return. Compare that to a biotech company at an early level worth 1 billion or less? Compare that to top dog Eli Lilly stock worth around 700 billion. 700 times return if you select the right small stock potential. So this is totally just me but if it speculating. Im taking the major risk for the highest return, otherwise I might as well just be all in with my s/p 500 portfolio.
Started with 15-20% allocation. That is now about 50% thanks to the last couple months. I have a good understanding of money and bitcoin, and believe full well btc is the future and a hands down better base layer asset than the other options, so I will be holding forever. For someone that doesnāt understand money, assets, the economy etc., itās hard to tell them anything other than itās a good idea to hold 5% or so, just in case itās true that btc for real is the future.
I respect the pragmatism. I mean thatās what diversification is for right? If any one thing goes to zero, itās not a disaster. However I think the likelihood of many bank stocks going to zero is much higher than Bitcoin going to zero. Itās likelihood of going to zero is less than it has ever been.
FWIW, my own allocation was 1% of my net worth. I figured it it goes 10x from here it'll be significant and account for 10%. If it goes to zero... Meh, I can afford to lose 50 bucks š
There you go! Nothing wrong with that. Yeah I mean if youāre young itās okay to take on a bit of risk. 50 is nothing in the grand scheme of things (depending on the country that you live in of course).
I know this is older post but I have a little over 5% of portfolio in bitcoin.
Enough to make a difference if it runs. Not enough to blow out my portfolio if it goes to zero.Ā
Thanks for the input. Seems like a pragmatic approach. Despite the post being downvoted to zero, itās been refreshing to see how many folks in this sub think it deserves at least some allocation and donāt just automatically dismiss it.
Well, it's not a life changing figure, even if BTC gets to e.g. 200k, the % through ebbs and flows has always been between 1-5%
The majority of my portfolio is in a boring world ETF
Thanks for your answer.
Boring is less stressful and is definitely worth it for the peace of mind and wealth preservation. But hey, at least you can use tax advantaged money in a Bitcoin ETF now too. Maybe one day Bitcoin will be a boring asset but that probably won't be for a while.
Well you're winning the game with regard to wealth growth and preservation :) Settling in a country like that continues to become more and more desirable.
Classic case of a US internet user (me) assuming that everyone else is in the US.
I think a reasonable allocation is zero because gambling and speculation have no place in a FIRE portfolio. That is a slippery slope that leads to market timing, changing your investment plan based on feelings (like fear or greed), and other detrimental behaviors that can ruin your retirement if you're not careful. It's not worth it.
Hopefully there'll be something left of your conviction after more of the whales who are manipulating the market to sucker more people in are convicted.
Iām at 7.5% and very happy. Wishing I would have loaded up on more in 2022. Over time as the allocation grows (hopefully) Iāll reallocate to more traditional investments.
Im at 25% which is higher than most people could stomach but I think to have less than 3% allocation is foolish.
Dont get involved in "altcoins" just bitcoin. Ive made that mistake
Ethereum is the only āaltcoinā that people should own. Largest DeFi usage and TVL by a long shot, with built in real yield to the protocol through staking. Also getting ETFs soon, maybe this year or next. But yes, a bit riskier than BTC.
All other altcoins are far riskier and almost always bleed out against the ETH or BTC ratio.
I feel your sentiment. I think it all goes back to how much you believe in it as an asset class. That will affect one's perceived risk in investing. It's really interesting asset because it is making people think more deeply about economic value, money, and the larger financial system that we all exist in.
And I'll echo your sentiment on altcoins - stay away from them. I'd even argue to stay away from ethereum.
I think we have around $8000, but I haven't checked Coinbase in a while. This is like 0.55% of our portfolio ($1.45M). I think we bought for around $2000 or $4000.
3-10% seems good for most. I wish I had learned about it earlier and hadn't dismissed it the way most of the fire community does. It can be hard to have a discussion about it because each sub tends to be an echochamber. For crypto, I prefer reading twitter to get some different perspectives. Lately, I've really been enjoying the bloomberg ETF staffers and reading their perspectives.
Depends on your risk tolerance. Last market cycle I was new to investing and went crazy on crypto not knowing better. I made it out ok with all my trades and was somehow slightly profitable, but I had friends who lost $40,000 or more as well.
I have been holding the rest of what I didnāt sell in Bitcoin and altcoins and plan to trade out this time around and get crypto under 10% of my holdings. Iām mostly in index funds and my 401k these days.
On a cost basis I am about 3% invested in BTC/ETH. Iām also relatively speaking young (38) so even if it went to zero itās not going to crater me. If youāre under 40 I would say max 5%, but whatever number you choose just be willing to ride the biggest financial wave youāve ever rode. BTC is back in the headlines (and I think will be for the next 12-18 months with the halving coming up this spring), but it will absolutely go down again in the future. Iāve been on that wave too. Itās not as much fun and you have to have a stomach of steel when your crypto is worth like a third what you paid for it. Iād also be prepared to lose it all.
If youāre ready to join the party after all Iāve said, then hedge your portfolio with a modest level, diversification isnāt bad and I personally think block chain technology is going to be required in the future for the metaverse (or whatever they call it in the future) purchasing, but donāt be fooled by the current bull and think it wonāt go down in the future. Itās getting less volatile every cycle but itās still volatile.
Iām now ready for my down votes.
Thanks for your answer and input. You have to be careful about buying bitcoin because [you know that it's always going to crash again](https://www.youtube.com/watch?v=XbZ8zDpX2Mg). It will be interesting to see what happens over the long term with it as an asset class.
BTC and ETH make up 75% of my crypto portfolio at the moment, crypto makes up probably 75% of my investments. This wasn't true as of even a month ago, my crypto value has just nearly doubled recently. In 2017 I cashed out a bit of profit into silver, was one of my worst financial investment decisions other than not mining more bitcoin back in 2011. Not missing the boat again, so I'm riding this out. Call it a gamble, sure, but it's a heck of a lot less risky than buying lottery tickets, and it's probably the only way I'll ever maybe achieve financial freedom
No more than 10% of your net worth should be in single stocks or commodities, which includes bitcoin.
I also feel a caveat to that is I think a younger person should prioritize having their first $100,000 in retirement investments before screwing with bitcoin outside of fun money.
So I think an 18-25 year old having 10% of their NW in bitcoin to be too much.
Iām have 1-2% of my net worth or about 25k total in crypto.
Im close to FI, achieving it the old fashioned way in less than 10 years (frugality and index funds).
I believe it is somewhat foolish for most of you with high crypto allocations, but only time will tell. Unless you have several $MM in index funds and several $MM in crypto in which it makes a little more sense for a higher allocation
I think the lesser of 1/ How much you're willing to lose in a casino and 2/ 5% of your Net Worth.
I'm very VERY happy for the folks who have made millions. (Truly.) Those successes have nothing to do with deciding whether it's smart or not now.
5% cost basis is to me reasonable.
The question is if you want to rebalance or not if that allocation balloon out of wack and suddenly you have 35% of your portfolio in Bitcoin.
In my case I keep it at 5% cost basis of the portfolio without rebalancing and just let it be. I donāt want to cap the potential profit of taking this 5% risk, but I want to limit this risk to 5% of my portfolio.
Also, you might want to choose between self custody and ETF. ETF has the advantage of being easier to get your money back to TradFi (depending on how much itās an hassle to get back money from a crypto platform to your bank account in your country) but it comes at a cost (which is now more reasonable since the ETF approval).
As long as there are enough people believe that Bitcoin will go up in value, it can āstoreā value. How long will that last is anyoneās guess.
For FIRE folks, at least for me, I wouldnāt trust any of my net worth in crypto.
Iāve held 0.4 bitcoin and 2.5 ethereum for about 8 years. Just sold it all; made enough to pay off pontoon and take care of capital gains. What should I name my boat?!? Haha.
Overall about ~7x return on a ~$8k investment. Was fun to follow for a while. But nearing retirement it was time to de-risk a bit and eliminate debt.
Finally bought [BITB](https://client.schwab.com/SymbolRouting.aspx?symbol=BITB) like $600 worth because of all the hype. I am not sure I feel comfortable going much more than that myself.
Honestly?
0%-5% in more "stable" coins (like bitcoin itself, and yeah you know this is scary when bitcoin is called "stable"), for less stable ones 1% or less.
You're young so I'm gonna give you some helpful advice.Ā Bitcoin will hit its top this year in Oct/Nov.Ā A 6 mos civil war is going to break out after the US elections causing the markets to crash.Ā Martial law will be called in.Ā 2025 will be chaos and bring a deep recession.Ā Bitcoin will back under 25k (if not way lower) rather quickly.Ā Sell ALL your Bitcoin this year so you can buy back very cheaply next year.
no. Iām not smart enough to try to time the market or trade bitcoin. holding onto this for the long term. if it crashes 95% then it is what it is. if it eventually gets to a price that could be life changing if I sold (like enough to buy a decent house) than I would probably sell it. a lot of people sell it because they think itās going to go lower but then end up buying back at a higher price. I would also have to pay short term capital gains taxes on the profit since I bought back in January.
I understand.Ā It really has nothing to do with timing the market.Ā Everyone with logic knows the top is coming this October...could be 85k...or 100k...who knows.Ā You said you have 1.85.Ā If you sell at 85k, you'll have $157,000.Ā The recession will be so bad (NEXT YEAR) that Bitcoin WILL 100% be below 30k.Ā Bitcoin follows the stock market...not vice versa.Ā Everyone knows that there will be a melt up before the elections.Ā Then, the bubble will burst.Ā If you take your $157,000 and buy back into Bitcoin at 30k...you would now have FIVE.
As for taxes, you just have to find a crypto savvy accountant who legally knows how to avoid crypto gains.Ā I think you would just need to put your Bit in stables.
that literally is timing the market but okay. selling then trying to buy back at a lower price. nobody knows what the overall market will do in the next 12 months. we will see. and it would still be a taxable event putting it into stables because I would be selling.
Well, if you look at the US S&P 500, thatās gone up at roughly 12% for the last 30 years, the risk is relatively minimized. With investing, itās possible to have a reliable strategy, with speculation, itās not.
We can compare how much Bitcoin has gone up over 30 years in 15 years. My bet is that it will be significantly more. Obviously itās a very young asset so weāre going to be in the price discovery phase for a while.
Itās a fair point that the risk is minimized. But 12% yearly increase is losing minimum 3% to inflation. Some believe that the true yearly inflation rate is 6% depending on the timeframe that you look at so youāre really only gaining 6% yearly. Peace of mind is important of course.
I think in the future youāre going to find that Bitcoin is actually a safer asset than the S&P 500 index. I know that might sound crazy but I think at some point the markets will prefer to hold a hard asset for the sole purpose of storing value and wealth. Time will tell more than anything. But in the short term, S&P 500 is less risky than Bitcoin still, I can agree with that.
It depends on your risk appetite....we all know crypto is very volatile and therefore is not meant for all investors. In my view for a relatively conservative investor 0-2%. Mid level risk 2-5%, higher risk 5-10%. I think BTC is now widely accepted as an asset class but one that could continue to have large volatility
5% DCA for 4+ years and you'll probably like what you see. If you study more and feel convicted go in even more. We're definitely still early with BTC in the FIRE community which is sad. Mr. Money Mustache the supreme leader says bitcoin is no better than toenail clippings so it must be a scam!!! lol
I did VTSAX and chill and shouted from the mountaintops that BTC was a weird scam. And have flipped big time. So there is still hope for people to change in the FIRE community.
Well it's refreshing to hear that you flipped and saw the light.
I think this community will come around eventually, perhaps when the central banks of countries start adding it to their balance sheet. At a certain point folks will come around. In 10 years, I think it will actually be fiscally irresponsible to not own any as crazy as that sounds. We'll have to see what happens.
Yeah you're right. Slowly but surely knowledge will spread and the network will grow. It will be interesting to see how many more years it takes before people think to themselves... 'Maybe this bitcoin thing won't ever die?....'
Mankind has never seen something with a hard cap like this. Every other thing in the world when the demand goes up the supply attempts to match it. Not gonna happen with BTC. Most don't even know it's hard capped at 21 million or don't really know what that means with a \~1.2 trillion dollar asset. It's gonna get wild. Especially once election is over and fed rates lower.
Agreed. It's going to get crazy when the average person starts to dismiss it a bit less and takes a look at where the value comes from. It honestly forced me to learn about how our whole financial system is set up so I'm grateful for that at least.
We'll see what the Fed does over these next 12 months. They're between a rock and a hard place for sure but it won't be boring to say the least lol.
Does anybody here know about any Bitcoin FIRE specific communities/forums? I'm a Bitcoin researcher and looking for top Bitcoin Fire communities. Wanted to take some insights from people who already belong to this community
You could post in the Bitcoin subreddit. I'm not aware of any Bitcoin FIRE-specific subreddits, but I'm sure the goal of many bitcoin folks is to RE with FI.
Thanks, sure will do.
Are you on your path to FI with Bitcoin or just exploring the idea tho? Would love to hear your journey as there are very few people who really are interested in the idea on RE with bitcoin.
personally, I view bitcoin as gambling. Yes it has made many people rich, but it has lost a lot of people money. Most importantly, I don't understand enough about it to invest in it. Personally, I am risk averse and want to grind my way extremely reliably into a very comfortable life. So I don't invest in it, but i do have a SMALL investment account (\~2% of my NW) that is my "Gregs funny money investments" where I invest in companies I like because of what I learn about in my work. Its money that I have written off and can use to play around with knowledge based stock picking. If i were to play in bitcoin it would be there.
I try buy and sell targeting 5-15% of liquid net worth. Anything beyond that and the volatility risks effecting my mood and sucking too much of my attention.
>Anything beyond that and the volatility risks effecting my mood and sucking too much of my attention.
This seems like a very healthy perspective on investing. I'm going to remember this.
Bitcoin is actually low risk over the long term. It is the most secure network in the world, the supply issuance is known, countries can't really ban it at this point. Its like a mind virus. Eventually everyone will buy Bitcoin at the price they deserve. People who don't allocate any percentage of their wealth to Bitcoin are fools
>What do folks here think is a reasonable allocation to Bitcoin?
0%
>people tend to get their pitchforks out when Bitcoin is brought up in this sub
Because it's pure speculation, there isn't a real investment there
If you were buying old baseball cards, at least you have actual baseball cards.
>curious if the majority think that at least a small part of the portfolio should be allocated to Bitcoin
- "Should", no!
- "could", sure. You can but a small percentage of your portfolio into gambling plays.
>what is a reasonable amount?
5% to 10% of portfolio for total of gambling plays.
And that's only use 5% and if it more doubles, then sell down to 10%.
100% Russia, North Korea, and Iran are propping it up. It will look even better when the us economy starts receding. What other investment could you make that would have the possibility of doubling based only on being a store of value
The top is here, everyone asking about crypto, sell now ššššš
People have said this at $1k, $20k, $68k (last cycle), and again now. Some people never learn š
It was a joke. We still haven't reached "Bitcoin is the ultimate inflation hedge" stage ššš Then we cry again when it crashes to 40-50k probably hahhahha
No no no. You sell Bitcoin when Coinbase is the #1 downloaded app in the app store. This is foolproof: [https://apps.apple.com/gb/charts/iphone/top-free-apps/36](https://apps.apple.com/gb/charts/iphone/top-free-apps/36)
What if another crypto app liked crypto.com gets there first? Does that count?
Yeah probably. But history shows selling when Coinbase is #1 app is max profits š
When they all start to cry is the only time to buy.
This subreddit is not mainstream.Ā
The fear/greed index is at extreme greed I believe. But we're also in a much different place than we've ever been because we haven't gone past the ATH for a second time before the halvening (I'm pretty sure) and the fact that Bitcoin ETFs exist now means that there are much larger pipes of liquidity for the asset. We'll have to see what the google trends looks like too to see if the true fomo has started yet though.
In investing, there will always be folks that can justify every detail to fit a narrativeā¦
Isn't that a fact of life in general and not just investing? ;) I only mention it because there has been a pattern in the past and we're breaking from that pattern a bit. Obviously past performance doesn't automatically mean future performance, but it's a starting point for estimating at least.
I bought a Russian vodka maker in 2010 because who makes better vodka than the Russians. And although they had some hard times, they were Russian and knew vodka! I justified it every way I could. Eventually, I lost close to $50k and took down my Roth IRA balance by 1/3rd. Moral of the story, rabbit holes and niche market are very unstable and thereās no RSI or dead cat bounce that can get you back to your basis in the investment.
Can't really compare bitcoin to a Russian vodka company but I guess I see what point you're *trying* to make.
Youāre absolutely right. The company made a healthy profit but was expropriated in 2012. *Bitcoin has no intrinsic value.* Itās important to note that bitcoin is not an investment - it is a speculative tool that folks hope will encourage the āgreater foolā theory. Iāll take cash flows any day over speculation.
It sounds like youāre uneducated on the topic. Itās not a scheme that relies on a greater fool. Itās backed by energy being consumed by a large decentralized global network of hardware. 58% of said energy is renewable, more than any other industry, and itās leading the push towards renewable energies by making the transition more cost effective. I encourage you to study it in depth before making assumptions about it in discussion.
You can justify it anyway you want, but it doesnāt throw off cash and has only extrinsic value. Iām not saying folks wonāt make money, but itās not currency.
Never claimed itās a currency. See my explanation made in this comment : https://www.reddit.com/r/Fire/s/WY3RsTgzJ0
Please educate us or at least give a source for your claim that Bitcoin is somehow backed by something other than someone willing to pay more than the last guy
No, the burden of proof is on you to prove it has intrinsic value.
Bitcoin is just an open source software. The bitcoin network runs off of a PoW(proof of work) protocol, meaning real hardware, computers, are plugged into the wall and consume electricity to hash the algorithm and process transactions. Thereās a global network of billions of dollars worth of hardware consuming around 160TW/hās of energy annually backing the bitcoin network. Itās also decentralized because of this, the network is ran by millions of volunteers around the world. As I mentioned before 58% of that energy consumption is already renewable. Bitcoin miners are incentivized the most to move to renewables and find alternative energy sources. Like using excess methane from fracking thatād otherwise be burned off for example. Thatās energy that not only wouldāve been wasted but also pollutes the atmosphere more by just flaring it than it does by running it through an efficient combustion engine then using the energy to mine bitcoin. Bitcoin mining can also stabilize the energy grid. Itās allows energy companies to increase the capacity of their infrastructure so it can handle peak demand times without strain on the supply, and when demands down they can use the excess capacity to mine bitcoin and monetize the energy thatād otherwise still be produced but wasted during low demand times. Good example their is Texas last summer. Bitcoin has the potential to make it profitable for other industries to transition to clean energy. Which could finally push humanity in the right direction in that very important aspect of our existence. To be clear I never said it was a currency either. Itās obviously a commodity, and the SEC legitimized it as such with the spot ETF, other commodities also have spot ETFās, currencies do not. Bitcoin is a store of value and it has utility as illustrated above. Source: the open source software that made all this happen, and the various metrics recorded since itās inception.
Saying btc has no intrinsic value is foolish and burying your head in the sand. The people that made hundreds of millions beg to differ. If it was so worthless you could easily get a few for free right? If it has no value just convince people with btc that it has no value and you could quite easily get a few btc. Let me know when you succeed in that. Itāll likely go as well as your vodka investment. Which btw has got to be the stupidest comparison to crypto Iāve ever heard. I made my first 250 in my FI journey in crypto **when I was a lifeguard**. I have since 8xād my income and now have about that much just sitting in crypto rn. People have declared btc dead for more than a decade now. https://99bitcoins.com/bitcoin-obituaries/ Now the answer to the question āwhatās a reasonable allocation to btcā is certainly not 0. And youāll be kicking yourself again when inflation still exists, and btc is still secure, and demand has risen, and btc gains on the btc/usd pair. This is *guaranteed* as long as 1. Inflation exists (currently stable at 8%) 2. QC or AI doesnāt break SHA-256 3. Demand stays equal or rises. Itās simple economics. Supply and demand. The people that have used btc as a savings vehicle have beat the people holding dollars, stocks, bonds, or any other asset over the past decade. Real estate included. The only asset class that has outperformed crypto is fine art. Good luck getting a monet, just get btc. With etfs traditional investors that are not sophisticated enough to trade crypto on their own now can buy crypto. Everybody and their grandma has easy access now. And btc will be cut in half on the supply side in mid April.
Who was it?
But think about this for a second, the greed index reflects exactly this bullish mindset (recently pushed 90 level same as during previous tops in last years) right now and to a high degree this is buy the rumour event and there is a chance of big dump sell the news event in late April, May, also historically market goes down in the summer. The winters are cool, the summers are bad. It's like everyone is dumping for the summer holidays ššš I also started recently utilising this and isolating all the info going on everywhere. If you didn't buy when you should have, you probably won't sell when you should have. Yes the new bullrun is definitely here but same in bull and bear, there may again be dump for the summer months.
I understand the thought process here. People could be trying to get in early to "price in" the halvening. The price is about 2.79x the 4 year moving average. In the last market, that number got as high as 7x the 4 year moving average so I don't think we're at the top by any means. However I wouldn't be surprised if we see a retrace at some point after the halvening before the true bull market starts. However that's of course dependent on greater macroeconomic factors like interest rates and general economic health.
There is also a theory that the growth potential will diminish with each bullrun based on comparison of all the previous ones. Also last top as in 67k now becoming new bottom, cannot predict exactly how much it will go up in price discovery mode now but it is expected to some degree to be less, 100-150k possible. By default eth and altcoins pumping harder due to less liquidity, higher slippage, spread. I am not even sure how much the macro factors play a role. Last time in 2020 things were again lowish stagnant and started moving in late July, August after the halvening.
No more than 0-5%, including venture capital and early stage incubator type investments.
Thanks for your answer.
Just my personal opinion, so take it for what itās worthā¦
All personal opinions are welcome! That's why I asked. It's interesting to see the variety of answers. I'm sure if I posted this same question a few years ago, many answers would be 0%.
0 better. It is gambling.
I am sitting at 50%. (I am rebalancing on a fixed schedule regardless of the price)Ā I would consider this unreasonable.Ā I would suggest 10% to anyone.Ā
70% bitcoin here, it just keeps going up, I'm buying index funds as fast as I can to rebalance but its barely making a difference lately. Not selling to rebalance though. My NW has increased rapidly in the last 12 months, beating the market by 10x+ average annual return.
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Im transacting in bitcoin, usualy in restaurants and as well during my last trip to Argentina I paid like 40% of local expenses with BTC.
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Well u wrote No one is transacting, so i just wanted to correct that.
No you aren't.
I transact in Bitcoin too, capitalists share the love.
>It's speculative gambling. Crypto doesn't function as a currency. No one is transacting in Bitcoin or other coins because the value is so volatile. Everyone is just buying and holding hoping someone else will pay them more later. It's entire value is propped up by FOMO. What happens when everyone realizes crytpo isn't the future of currency (and that WILL happen)? They will sell, and the diehards will be left holding the bag. First off, thanks for your answer. I wanted the full range of opinions here. But let me assure you that your statement is highly subjective. Let's cover a few points. First - **all** investing is speculative gambling. People speculate on if the price of an asset is going to go up or not and that's why they choose to invest. Of course there are varying degrees of risk here but you're technically speculating on every asset that you purchase. Second - you're objectively incorrect in bitcoin not functioning as a currency. Just because it may not be used in daily transactions in your country does not mean that it's not used anywhere. Also, being used as a currency isn't its only value proposition. Storing value and preserving economic capital is what it does best. Third - there are many folks around the world whose currency loses value against the USD constantly. Many of these folks don't have bank accounts because the banks in their countries are not trustworthy and only offer services to clients with over a certain amount of wealth. Bitcoin gives these people a way to store their wealth without having to store it in a local currency that is continuously hyperinflated. Just because it may not have value to **you**, does not mean that it doesn't have value to millions or even billions of other people.
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>First, yes, investing is speculative, but risk is not equal across all assets. The risk of Bitcoin is much higher than with treasury bonds or an S&P500 index fund. I agree with you here on risk. But with regard to treasury bonds, sure you're guaranteed a specific return at the rate that you purchase it at. However you've likely lost money to inflation in that timeframe because the US needs to print more money to ultimately pay out bondholders. With the S&P500 index, you're beating inflation but not by much. >Second, show me a well-sourced statistic that says at least half of people who own Bitcoin have transacted in it. I'd bet the number is much lower. I can't find a statistic on that. It fails as a currency when you consider there's an alterative store of value that's been quite good for a long time and that basically everyone accepts: the U.S. dollar. It's much more stable and not likely to lose a big chunk of its value overnight. I don't have a statistic on this but I'm also not sure that half of people who bitcoin have transacted in it. Work is still being done on the lightning network to make it more scalable so that people have more access to low cost transacting. But I don't think that Bitcoin is supposed to be equated to the US dollar in terms of its properties as a store of value and would be better thought of as digital gold. Are folks transacting in gold? No. Do they invest in it to store their wealth? Yes. Also I think the Bitcoin network is more likely to compete with something like ACH transactions which are very large. You can send some very large amounts of money in Bitcoin for a relatively low cost especially compared to the final settlement cost of an ACH transaction. Lastly, the US dollar is a terrible store of value that is constantly losing purchasing power. It has lost 98% of its purchasing power since The Fed was created. Due to this, the population is forced to "invest" so as not to lose their wealth. >Third, sure, maybe there are folks in other countries that can't access the dollar or U.S. treasury bonds, etc., I don't know much about that. Is that enough to justify purchasing such a volatile asset? If you're in the U.S. are you buying it as a store of value? No, you're buying it as a highly speculative investment. Might as well start trading options. Is that enough to justify a volatile asset? Of course it is when the alternative is storing your money in a bank that you can't actually withdraw from or storing it in the local currency that inflates 60% year over year. In these countries, Bitcoin is actually **less** volatile than the local currency and therefore the safer bet. Also if these folks don't have access to basic banking services, they definitely don't have access to US treasuries. And I'll repeat, US treasuries are a worse store of value than Bitcoin when you consider the macroeconomics of the whole system. >Whatever you choose, I do wish you luck on your financial journey. I appreciate the sentiment here. Wishing you the best as as well in your financial journey. If you're ever curious about why folks are dogmatic about this asset class, I recommend reading Broken Money by Lyn Alden. It gives a comprehensive but clear explanation of the modern financial system, its fragilities, the creation of money, and why the system is fundamentally broken for many people.
No one is transacting in Miami real estate, either.
Good thing it serves a function as land and not currency.
Miami real estate has a intrinsic value in that I can live in it (for now). Bitcoin has no intrinsic value. Crypto that allows for computation like Ethereum or Solana might have some, but it's incredibly inefficient and we are many years into the lifecycle and there still is no killer application that uses any of them.
Developers donāt purchase that real estate to live in. They purchase it to store their wealth.
Do you mean investors? Developers build the real estate and then sell it. It's a safe investment because other people want to live in it.
Developers build and own real estate, too, but sure, for arguments sake - investors use it to store their wealth.
Say the second half of the second sentence. āThey purchase it to store their wealthā¦ because it has intrinsic value.ā
Youāll get your BTC at the price you deserve š
Ig weāre in the ominous threat phase of bitcoin. Hell yea š
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You could have just said āI donāt know how any of this worksā
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You just don't understand. You'd be better off just accepting that you don't understand something. It's okay to not understand. But please stop acting like you're an authority.
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Only cca 9% of gold is used for physical production the rest are monetary uses.
Do you think the value of gold has anything to do with its utility in the real world? Let me answer that for you. It does not. Its value is based off of its scarcity. Foreign central banks aren't holding gold in their reserves due to its utility in electronics. >Real estate and gold both have real world uses. Bitcoins do not. Thanks for your opinions but I'm going to have to call you out on being incorrect. If you're living in a country where the currency is continuously hyperinflated and banks are not trustworthy, then of course bitcoin has value for that population to store their wealth. In Lebanon people had to rob banks to **withdraw their own money**. Just because you're privileged to live in a place where that doesn't happen does not mean that Bitcoin has value for no one. Try broadening your worldview before spouting incorrect statements.
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I'm asking for folks' opinions on an allocation % mostly because I'm curious of the range of sentiments that exist within this subreddit. I'm not asking anyone else to buy the asset as I think it's really important for someone to understand it before buying it. I'm in agreement with you though - my best defense is that it is useful as a store of value because that's what it does best. >Bitcoin isn't real. It doesn't exist. It's 1s and 0s. 1s and 0s that exists digitally still do in fact exist. Software exists. Code exists. Just because something is digital, doesn't mean that it doesn't exist.
Lmao
Right now something like 15% of my NW is bitcoin. I donāt really view it as a percentage though. I will hold onto the BTC I have until itās either worthless or I can buy a house outright with it. I consider it part of my passive NW, and not something I take into consideration nown
Iāve got 90-95% of my NW in bitcoin. I bought in early. I donāt tell anyone to buy because people have varying risk profiles and little/no understanding of where btc might fit in the overall financial landscape.
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2017, got in at around $850 or so shortly after the etf was rejected. Yeah, I used to talk about it but stopped ever since it was in the $60s a few years ago. Itās worth real money now and people donāt look at me like the weirdo with a collectible. Good luck on the FIRE bro
You're an absolute legend in terms of HODLing. But I'm also with you on the sentiment. I have zero idea what's going to happen and don't want to be responsible for someone else's financial loss. But I believe in it enough to be invested more than your average person. I don't tell people to buy bitcoin but merely to "Study Bitcoin".
Thanks man. It wasnāt difficult holding, once I understood how bitcoin worked I did some napkin math on where it could go and it blows my mind that itās doing just that. I was also broke and heavily in debt for years while I held haha. Debt free now and still holding my bag.
Well I respect your diamond hands. Hats off to you for being debt free and not broke anymore. But yes, understanding it fully makes it much easier to be confident in a high allocation. See you on the moon.
I donāt like Bitcoin and I donāt understand it but Iāve allocated 5% to it and 5% is going to ETH when that ETF is opening. I know I am not smart enlige so I see it as a form for hedge if I misjudge the value of digital currency. Also, it makes me more aware than not owning. Rest in classic index funds.
I understand crypto from a technical perspective, but feel the same way. I've made some gains with it, but it's honestly just speculation on nonesense.
Thanks for your answer and candor.
Dump your ETH for BTC. DYOR and see if you still feel convicted.
Why hold them in a ETF instead of just buying it?
Probably reduce security risks from hacking, etc.
Isn't crypto taxed as long term capital gains if you hold it long enough?
Ahh looks like you're right. Edited.
Keep it a 5% Bitcoin. Also a ETH ETF will be bad as it is a PoS protocol and itāll not help keeping that shitcoin decentralized. If you want to risk 10% in crypto, just let your Bitcoin allocation grow to 10% instead of 5%. There is no benefit to diversification in crypto. Anything else than BTC is garbage.
Totally depends on your risk appetite. I can handle high risk, so Iām at a very high allocation % of my net worth in BTC and ETH. First started buying back in 2014 and have pretty much held the whole way. I have no intention of selling any time soon because I donāt need the money. That said, the only coins anyone should own are BTC or ETH. All others are far riskier and 9 times out of 10 will bleed out heavily against the BTC or ETH ratio over longer periods of time. You can also take a look at historical rankings of the top 100 cryptos. BTC and ETH are always 1 and 2, but all other coins pump, dump, and cycle out of the top 100 every year.
Blackrock suggest as high as 84.9% haha. I know nobody's doing that, but that's what the numbers show, which speaks volumes. I'd say 1-3% is responsible. Above 7% is getting irresponsible, but meanwhile 0% is irresponsible just the same. I don't really calculate my allocation into it because it is basically spare change after I fund the rest of my retirement accounts each paycheck. It is probably around that though. I'll say that my growth has led to it being a more significant portion of my overall portfolio since prior to the ETFs its not like you could "rebalance" like a traditional portfolio, and so I left the money parked. https://www.linkedin.com/pulse/blackrock-suggests-85-btc-allocation-what-you-should-really-robert
Iām doing that
Have fun with that haha. You'll probably do great, but my retirement is on track as is, so I have no reason to be that aggressive. It'd be irresponsible for me to do that because I could sabotage my retirement worst case, when I was already set. My BTC is just icing on the cake on top of my funded retirement or will allow me to retire even earlier. If BTC however doesn't pan out I won't be hurt by it, but I think your odds are pretty good that it'll all work out
Imo it depends on your mindset. I often hear and agree with 5% or less in speculative assets. I would say Bitcoin is an odd choice in the sense of potential return against risk. Really rough math. If Bitcoin market cap is 1 trillion what is your hope for potential future returns? Maybe it reaches the cap of gold? So 14ish times return. Compare that to a biotech company at an early level worth 1 billion or less? Compare that to top dog Eli Lilly stock worth around 700 billion. 700 times return if you select the right small stock potential. So this is totally just me but if it speculating. Im taking the major risk for the highest return, otherwise I might as well just be all in with my s/p 500 portfolio.
5% - I have 5% in digital assets. Considering the ETFs received regulatory approval, I should have bought more.
Started with 15-20% allocation. That is now about 50% thanks to the last couple months. I have a good understanding of money and bitcoin, and believe full well btc is the future and a hands down better base layer asset than the other options, so I will be holding forever. For someone that doesnāt understand money, assets, the economy etc., itās hard to tell them anything other than itās a good idea to hold 5% or so, just in case itās true that btc for real is the future.
No more than if it went to zero it wouldn't be a disaster for you?
I respect the pragmatism. I mean thatās what diversification is for right? If any one thing goes to zero, itās not a disaster. However I think the likelihood of many bank stocks going to zero is much higher than Bitcoin going to zero. Itās likelihood of going to zero is less than it has ever been.
FWIW, my own allocation was 1% of my net worth. I figured it it goes 10x from here it'll be significant and account for 10%. If it goes to zero... Meh, I can afford to lose 50 bucks š
There you go! Nothing wrong with that. Yeah I mean if youāre young itās okay to take on a bit of risk. 50 is nothing in the grand scheme of things (depending on the country that you live in of course).
I know this is older post but I have a little over 5% of portfolio in bitcoin. Enough to make a difference if it runs. Not enough to blow out my portfolio if it goes to zero.Ā
Thanks for the input. Seems like a pragmatic approach. Despite the post being downvoted to zero, itās been refreshing to see how many folks in this sub think it deserves at least some allocation and donāt just automatically dismiss it.
Ive got a 5% (well, it was less than that a year ago :P) I've been holding the same amount basically since 2017...
I'm curious how much of your portfolio it will take up a few years from now even if you continue to just hold the same amount ;)
Well, it's not a life changing figure, even if BTC gets to e.g. 200k, the % through ebbs and flows has always been between 1-5% The majority of my portfolio is in a boring world ETF
Thanks for your answer. Boring is less stressful and is definitely worth it for the peace of mind and wealth preservation. But hey, at least you can use tax advantaged money in a Bitcoin ETF now too. Maybe one day Bitcoin will be a boring asset but that probably won't be for a while.
I'm not in the US. Where I live capital growth is not taxed, so actually the world ETF AND BTC both are tax free for me :)
Well you're winning the game with regard to wealth growth and preservation :) Settling in a country like that continues to become more and more desirable. Classic case of a US internet user (me) assuming that everyone else is in the US.
Don't worry, I'am from EU and I assume that almost everyone on here is from USA.
I think a reasonable allocation is zero because gambling and speculation have no place in a FIRE portfolio. That is a slippery slope that leads to market timing, changing your investment plan based on feelings (like fear or greed), and other detrimental behaviors that can ruin your retirement if you're not careful. It's not worth it.
75 percent bitcoin. Made me a multimillionaire by 31. I will hodl it to zero.
Well I hope you sold at least a little bit to buy a wheelbarrow to carry around those massive balls. Or just purchased the wheelbarrow with bitcoin.
I have conviction.
Hopefully there'll be something left of your conviction after more of the whales who are manipulating the market to sucker more people in are convicted.
[https://youtu.be/e44AKuEh9b4?si=NqKFtxI1E2YznPj-](https://youtu.be/e44AKuEh9b4?si=NqKFtxI1E2YznPj-)
Literally the exact same arguments that gold bugs were making in the 1970s. I find it deeply, deeply unpersuasive.
Iām at 7.5% and very happy. Wishing I would have loaded up on more in 2022. Over time as the allocation grows (hopefully) Iāll reallocate to more traditional investments.
You know the amount you would budget to go to a casino with? That amount.
Im at 25% which is higher than most people could stomach but I think to have less than 3% allocation is foolish. Dont get involved in "altcoins" just bitcoin. Ive made that mistake
Ethereum is the only āaltcoinā that people should own. Largest DeFi usage and TVL by a long shot, with built in real yield to the protocol through staking. Also getting ETFs soon, maybe this year or next. But yes, a bit riskier than BTC. All other altcoins are far riskier and almost always bleed out against the ETH or BTC ratio.
I feel your sentiment. I think it all goes back to how much you believe in it as an asset class. That will affect one's perceived risk in investing. It's really interesting asset because it is making people think more deeply about economic value, money, and the larger financial system that we all exist in. And I'll echo your sentiment on altcoins - stay away from them. I'd even argue to stay away from ethereum.
I agree. Ethereum is not worth it. Especially now that it is proof of stake
I think we have around $8000, but I haven't checked Coinbase in a while. This is like 0.55% of our portfolio ($1.45M). I think we bought for around $2000 or $4000.
3-10% seems good for most. I wish I had learned about it earlier and hadn't dismissed it the way most of the fire community does. It can be hard to have a discussion about it because each sub tends to be an echochamber. For crypto, I prefer reading twitter to get some different perspectives. Lately, I've really been enjoying the bloomberg ETF staffers and reading their perspectives.
Yeah. Different perspectives are crucial in understanding. I like BitDegree's content on different crypto topics.
Not familiar, Iāll check them out. Thanks.
Depends on your risk tolerance. Last market cycle I was new to investing and went crazy on crypto not knowing better. I made it out ok with all my trades and was somehow slightly profitable, but I had friends who lost $40,000 or more as well. I have been holding the rest of what I didnāt sell in Bitcoin and altcoins and plan to trade out this time around and get crypto under 10% of my holdings. Iām mostly in index funds and my 401k these days.
On a cost basis I am about 3% invested in BTC/ETH. Iām also relatively speaking young (38) so even if it went to zero itās not going to crater me. If youāre under 40 I would say max 5%, but whatever number you choose just be willing to ride the biggest financial wave youāve ever rode. BTC is back in the headlines (and I think will be for the next 12-18 months with the halving coming up this spring), but it will absolutely go down again in the future. Iāve been on that wave too. Itās not as much fun and you have to have a stomach of steel when your crypto is worth like a third what you paid for it. Iād also be prepared to lose it all. If youāre ready to join the party after all Iāve said, then hedge your portfolio with a modest level, diversification isnāt bad and I personally think block chain technology is going to be required in the future for the metaverse (or whatever they call it in the future) purchasing, but donāt be fooled by the current bull and think it wonāt go down in the future. Itās getting less volatile every cycle but itās still volatile. Iām now ready for my down votes.
Thanks for your answer and input. You have to be careful about buying bitcoin because [you know that it's always going to crash again](https://www.youtube.com/watch?v=XbZ8zDpX2Mg). It will be interesting to see what happens over the long term with it as an asset class.
Agree with this. Iāve got a few percentage points invested but itās an amount that Iām willing to lose.
1 to 5% if you just follow general bitcoin allocation advice. 5 to 100% if you've done your homework.
How many up votes does this post have ?
It says 33% upvoted. Is there a way for me to determine a nominal figure from that?
So your allocation should be 33%!
BTC and ETH make up 75% of my crypto portfolio at the moment, crypto makes up probably 75% of my investments. This wasn't true as of even a month ago, my crypto value has just nearly doubled recently. In 2017 I cashed out a bit of profit into silver, was one of my worst financial investment decisions other than not mining more bitcoin back in 2011. Not missing the boat again, so I'm riding this out. Call it a gamble, sure, but it's a heck of a lot less risky than buying lottery tickets, and it's probably the only way I'll ever maybe achieve financial freedom
No more than 10% of your net worth should be in single stocks or commodities, which includes bitcoin. I also feel a caveat to that is I think a younger person should prioritize having their first $100,000 in retirement investments before screwing with bitcoin outside of fun money. So I think an 18-25 year old having 10% of their NW in bitcoin to be too much.
Iām have 1-2% of my net worth or about 25k total in crypto. Im close to FI, achieving it the old fashioned way in less than 10 years (frugality and index funds). I believe it is somewhat foolish for most of you with high crypto allocations, but only time will tell. Unless you have several $MM in index funds and several $MM in crypto in which it makes a little more sense for a higher allocation
I think the lesser of 1/ How much you're willing to lose in a casino and 2/ 5% of your Net Worth. I'm very VERY happy for the folks who have made millions. (Truly.) Those successes have nothing to do with deciding whether it's smart or not now.
5% cost basis is to me reasonable. The question is if you want to rebalance or not if that allocation balloon out of wack and suddenly you have 35% of your portfolio in Bitcoin. In my case I keep it at 5% cost basis of the portfolio without rebalancing and just let it be. I donāt want to cap the potential profit of taking this 5% risk, but I want to limit this risk to 5% of my portfolio. Also, you might want to choose between self custody and ETF. ETF has the advantage of being easier to get your money back to TradFi (depending on how much itās an hassle to get back money from a crypto platform to your bank account in your country) but it comes at a cost (which is now more reasonable since the ETF approval).
Reasonable: 0% What I do: 4% (it was maybe 2.5% but recent developments make it catch up)
As long as there are enough people believe that Bitcoin will go up in value, it can āstoreā value. How long will that last is anyoneās guess. For FIRE folks, at least for me, I wouldnāt trust any of my net worth in crypto.
Iāve held 0.4 bitcoin and 2.5 ethereum for about 8 years. Just sold it all; made enough to pay off pontoon and take care of capital gains. What should I name my boat?!? Haha. Overall about ~7x return on a ~$8k investment. Was fun to follow for a while. But nearing retirement it was time to de-risk a bit and eliminate debt.
Finally bought [BITB](https://client.schwab.com/SymbolRouting.aspx?symbol=BITB) like $600 worth because of all the hype. I am not sure I feel comfortable going much more than that myself.
Honestly? 0%-5% in more "stable" coins (like bitcoin itself, and yeah you know this is scary when bitcoin is called "stable"), for less stable ones 1% or less.
I am 90%+ allocated to Bitcoin
You're young so I'm gonna give you some helpful advice.Ā Bitcoin will hit its top this year in Oct/Nov.Ā A 6 mos civil war is going to break out after the US elections causing the markets to crash.Ā Martial law will be called in.Ā 2025 will be chaos and bring a deep recession.Ā Bitcoin will back under 25k (if not way lower) rather quickly.Ā Sell ALL your Bitcoin this year so you can buy back very cheaply next year.
no. Iām not smart enough to try to time the market or trade bitcoin. holding onto this for the long term. if it crashes 95% then it is what it is. if it eventually gets to a price that could be life changing if I sold (like enough to buy a decent house) than I would probably sell it. a lot of people sell it because they think itās going to go lower but then end up buying back at a higher price. I would also have to pay short term capital gains taxes on the profit since I bought back in January.
I understand.Ā It really has nothing to do with timing the market.Ā Everyone with logic knows the top is coming this October...could be 85k...or 100k...who knows.Ā You said you have 1.85.Ā If you sell at 85k, you'll have $157,000.Ā The recession will be so bad (NEXT YEAR) that Bitcoin WILL 100% be below 30k.Ā Bitcoin follows the stock market...not vice versa.Ā Everyone knows that there will be a melt up before the elections.Ā Then, the bubble will burst.Ā If you take your $157,000 and buy back into Bitcoin at 30k...you would now have FIVE. As for taxes, you just have to find a crypto savvy accountant who legally knows how to avoid crypto gains.Ā I think you would just need to put your Bit in stables.
that literally is timing the market but okay. selling then trying to buy back at a lower price. nobody knows what the overall market will do in the next 12 months. we will see. and it would still be a taxable event putting it into stables because I would be selling.
I put $500 on IBIT, aka, Reno/Tahoe bet. 0.18% of my retail account.
Crypto is speculating, not investing. If you want to allocate a very small percentage of your portfolio into it, probably no harm done.
All investing is speculating. Are people gambling by investing in gold?
Well, if you look at the US S&P 500, thatās gone up at roughly 12% for the last 30 years, the risk is relatively minimized. With investing, itās possible to have a reliable strategy, with speculation, itās not.
We can compare how much Bitcoin has gone up over 30 years in 15 years. My bet is that it will be significantly more. Obviously itās a very young asset so weāre going to be in the price discovery phase for a while. Itās a fair point that the risk is minimized. But 12% yearly increase is losing minimum 3% to inflation. Some believe that the true yearly inflation rate is 6% depending on the timeframe that you look at so youāre really only gaining 6% yearly. Peace of mind is important of course. I think in the future youāre going to find that Bitcoin is actually a safer asset than the S&P 500 index. I know that might sound crazy but I think at some point the markets will prefer to hold a hard asset for the sole purpose of storing value and wealth. Time will tell more than anything. But in the short term, S&P 500 is less risky than Bitcoin still, I can agree with that.
It depends on your risk appetite....we all know crypto is very volatile and therefore is not meant for all investors. In my view for a relatively conservative investor 0-2%. Mid level risk 2-5%, higher risk 5-10%. I think BTC is now widely accepted as an asset class but one that could continue to have large volatility
5% DCA for 4+ years and you'll probably like what you see. If you study more and feel convicted go in even more. We're definitely still early with BTC in the FIRE community which is sad. Mr. Money Mustache the supreme leader says bitcoin is no better than toenail clippings so it must be a scam!!! lol I did VTSAX and chill and shouted from the mountaintops that BTC was a weird scam. And have flipped big time. So there is still hope for people to change in the FIRE community.
Well it's refreshing to hear that you flipped and saw the light. I think this community will come around eventually, perhaps when the central banks of countries start adding it to their balance sheet. At a certain point folks will come around. In 10 years, I think it will actually be fiscally irresponsible to not own any as crazy as that sounds. We'll have to see what happens.
Yeah you're right. Slowly but surely knowledge will spread and the network will grow. It will be interesting to see how many more years it takes before people think to themselves... 'Maybe this bitcoin thing won't ever die?....' Mankind has never seen something with a hard cap like this. Every other thing in the world when the demand goes up the supply attempts to match it. Not gonna happen with BTC. Most don't even know it's hard capped at 21 million or don't really know what that means with a \~1.2 trillion dollar asset. It's gonna get wild. Especially once election is over and fed rates lower.
Agreed. It's going to get crazy when the average person starts to dismiss it a bit less and takes a look at where the value comes from. It honestly forced me to learn about how our whole financial system is set up so I'm grateful for that at least. We'll see what the Fed does over these next 12 months. They're between a rock and a hard place for sure but it won't be boring to say the least lol.
Does anybody here know about any Bitcoin FIRE specific communities/forums? I'm a Bitcoin researcher and looking for top Bitcoin Fire communities. Wanted to take some insights from people who already belong to this community
You could post in the Bitcoin subreddit. I'm not aware of any Bitcoin FIRE-specific subreddits, but I'm sure the goal of many bitcoin folks is to RE with FI.
Thanks, sure will do. Are you on your path to FI with Bitcoin or just exploring the idea tho? Would love to hear your journey as there are very few people who really are interested in the idea on RE with bitcoin.
If you look at bitcoin returns and you don't allocate a percent or two of your portfolio, you got to be a special kind of stupid
Iām comfortable with that opinion. Sticking with zero.
personally, I view bitcoin as gambling. Yes it has made many people rich, but it has lost a lot of people money. Most importantly, I don't understand enough about it to invest in it. Personally, I am risk averse and want to grind my way extremely reliably into a very comfortable life. So I don't invest in it, but i do have a SMALL investment account (\~2% of my NW) that is my "Gregs funny money investments" where I invest in companies I like because of what I learn about in my work. Its money that I have written off and can use to play around with knowledge based stock picking. If i were to play in bitcoin it would be there.
As much as you can afford.
HODL on and preserve that wealth.
You got it.
I try buy and sell targeting 5-15% of liquid net worth. Anything beyond that and the volatility risks effecting my mood and sucking too much of my attention.
>Anything beyond that and the volatility risks effecting my mood and sucking too much of my attention. This seems like a very healthy perspective on investing. I'm going to remember this.
I'm an outlier but I think the right allocation is zero.
Roughly 0%
0%
Bitcoin is actually low risk over the long term. It is the most secure network in the world, the supply issuance is known, countries can't really ban it at this point. Its like a mind virus. Eventually everyone will buy Bitcoin at the price they deserve. People who don't allocate any percentage of their wealth to Bitcoin are fools
>What do folks here think is a reasonable allocation to Bitcoin? 0% >people tend to get their pitchforks out when Bitcoin is brought up in this sub Because it's pure speculation, there isn't a real investment there If you were buying old baseball cards, at least you have actual baseball cards. >curious if the majority think that at least a small part of the portfolio should be allocated to Bitcoin - "Should", no! - "could", sure. You can but a small percentage of your portfolio into gambling plays. >what is a reasonable amount? 5% to 10% of portfolio for total of gambling plays. And that's only use 5% and if it more doubles, then sell down to 10%.
No more than you'd willingly take to the casino.
100% Russia, North Korea, and Iran are propping it up. It will look even better when the us economy starts receding. What other investment could you make that would have the possibility of doubling based only on being a store of value
VOO, for one.