The reason people started advising to keep Bitcoins in a cold wallet and not touch them is because people sell them on exchanges. However, some people still misunderstand this and think it refers to not circulating them.
You should keep them in cold wallet but you should also keep some of them in your lightning wallet for spending. Circulation is essential.
I don’t even have a cold storage! 🐶🐾😂
12 words are just as safe as 24.. and the bitcoin never leaves the internet lol cold storage just means you have a device.. im no expert either lol
It means that it is not spent or working, circulating. 🐶🐾🫡
Not selling I mean actually p2p spending
That’s what I am talking about too. 🐶🐾🫡
On the whole business side like actual businesses for them to keep it in circulation it would have to take for their suppliers to also accept bitcoin you see Where that goes.. If the mom and pop shop needs to sell the bitcoin to pay the supplier for the things at the shop that stops the bitcoin from circulate. That's the problem that I'm seeing.
Maybe, but that is tangential to my question. I am asking about “cold storage” 🐶🐾🫡
Cold storage just means you have a device with 24 words that's it. You see I spend BTC everyday. But there's a certain amount of BTC that I consider cold storage because that amount I will never move. And I don't have a device. I use Phrases for my passwords 4 to 6 words as well.
I get it. But that still depends on how much of that is seating and literally does nothing. If it doesn’t flow in sufficient amounts, it doesn’t grow! 🐶🐾🫡
i find John Pfeffer’s analysis of the “velocity” of tokens a compelling explanation for why hoarding is a valuable aspect of bitcoin
https://s3.eu-west-2.amazonaws.com/john-pfeffer/An+Investor's+Take+on+Cryptoassets+v6.pdf
Until the goods are coming off the boat being paid with btc the problem is still gonna exist.
There are services on internet that accept BTC now, but if everyone treat it as cold investment that doesn’t help it! 🐶🐾🫡
I rwd that twice and I get what you are saying but there is a certain amount of btc that when you have enough purchasing power you will move lol
It's easy to get one. 🐶🐾🫡🫡
You NEED to keep some for the long term. Cold storage is more secure for long term. Start now build a stack. You’re future self will thank you.
Then what would I circulate? How would that help bitcoin adoption? 🐶🐾🤔
I didn’t say all, I didn’t say don’t spend. Not saving any bitcoin for the future is shortsighted. You can do both.
Fair! Let’s say in fiat you “save” X% of your paycheck. That X is probably measured less than 20-30. What you save, you probably don’t keep in the bank, you invest (circulation). With bitcoin, let’s say you save 50-80% in cold storage. Cold storage, if I understand it correctly, means no spending or circulation. So, my question still stands. 🐶🐾🫡
With all due respect, I feel like you're overthinking this. Cold storage means no spending, sure. But, it's still in circulation as long as the transaction IDs have been confirmed on the blockchain.
Lightning wallet = checkings account
Hardware wallet = savings account, 401k, Healthcare etc.
Then perhaps I am misunderstanding the concept of cold storage? Does the bitcoin in your cold storage work and circulate? What am I missing? 🐶🐾🤔🤷♂️
It just means your keys are stored offline. You can spend from cold storage if you want to.
It’s more secure which is better for longer time frames. Nothing is stopping you from spending tho. That is a personal choice.
Fair. But again, it’s unlike any other currency, when it is your saving, it is still circulating in investments or other products 🐶🐾🫡
There are over 1.9 quadrillion Satoshis there are enough to save some and also keep lots in circulation as you like to call it.
Forget everything you think you know about money and stop listening to inflation based Keynesian economics guidelines. Bitcoin is an investment AND everything else. If you have enough Bitcoin you really don't need to invest in anything else. Stocks, retirement plans, real estate etc. all become rather pointless when you own something that does nothing but go up in value.
Bitcoin is a currency, right? 🐶🐾🫡
😑 dude...
Yes
Ok, I think the note below explains part of my question! Thank you for being patient with me! 🐶🐾🫡🫂
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Buddy, you HAVE to read the Bitcoin whitepaper. Every hodler should.
Like I said, your holdings will ALWAYS be in circulation since your transactions have been confirmed on the blockchain. Cold storage just gives you a more secure way of accessing your own personal BTC savings. When you go to an ATM and punch in your four digit PIN to withdraw money, conceptually speaking, it is the same as entering your seed phrase to access your BTC account. You can choose to withdraw or not.
If you adopt it as money you should save some and spend some. Spending all of it isn’t going to make a big difference it’s already settling over a trillion dollars of value per year.
Cold storage doesn’t mean you can never spend it you can spend from your cold storage if you chose to do so.
I meant circulation and investment. Cold is cold, if I understand it correctly, and is taken out of circulation. It is unlike fiat, and more like gold in the vault. Does no good to economy. 🐶🐾🫡
False. Capital accumulation is key to investing in important things, starting a business, investing in equipment or inventory all require capital accumulation these things do help the economy. You are thinking high time preference.
Or land or a house a car etc etc you need to accumulate capital (bitcoin) to do these things not gonna happen if you zap it all away.
That is not a problem, and not exactly what I was asking. I meant “cold” and out of circulation, unlike other currencies. So far the closest analogy I can come up with, is gold. Scarce and largely unused. 🐶🐾🫡
The only bitcoin “out of circulation” is lost bitcoin that cannot be recovered. Cold storage just mean keys offline and usually for saving, meaning spend over longer time frame in larger amount.
Cold ≠ out of circulation
But cold is equal out of circulation while it is not spent. Since I am coming from a fiat world, where even you money in the bank are lent to others to do things and circulate, I see bitcoin cold storage as purchasing a bar of gold and keeping it to spend later. Am I missing something fundamental here? 🐶🐾🤔
Cold storage refers to security ie keys off-line usually with a device such as signing device aka hardware wallet. Your coins are never out of circulation they are able to be spent at any time without any permissions necessary no gate keeper.
Hot storage refers to a wallet where keys are stored on an online device such as a mobile wallet. Less secure, ok for smaller amounts and spending.
Both coins are in circulation, cold or hot just refers to key storage. Granted if you are saving for long term it would be foolish to store in a hot wallet as it’s less secure so better as a spending wallet.
The only coins “out of circulation” are coins that are permanently lost and cannot be recovered.
You can spend cold storage Bitcoin at any point you wish to do so without consulting or getting permission from anyone.
I hope that helps your understanding. Bitcoin is a deep rabbit hole.
I think this note gave me a little more insight now! 🐶🐾🫡
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💯 I got my ⚡️ wallet i use like a spending wallet.
Cold storage is my savings account
Both equally important.
This is exactly how it's supposed to be. 💯
Ok, but what percentage of what you have are in circulation? No need to give me a number, just a hypothetical question! 🐶🐾🤔
That depends on your personal needs. I even suggest keeping your main lightning wallet and zapping wallet separate, and ensuring that your main lightning wallet has a bridge to the on-chain. This would be the perfect combination and you can also set a budget. 🐶🐾🤔🤔
Pretend lighting wallet is literally your wallet in your back pocket.
If you lose that wallet. You at pissed but not broken.
Cold storage on the other hand. Treat like your life depends on it. Which is why we take such extreme measures with security and fall backs
Ok. Cold storage means money (BTC) is not working, just seating there.
If you go with fiat analogy, you keep the rest in the bank or stocks. Both use that to lend or spend, which puts your bank/investment in circulation. Cold storage is not, if I understand it correctly! 🐶🐾🫡
Ramsay Bolton is spot on with this answer.
