Do you move your sats to your on-chain wallet once you accumulate a certain amount? Or do you just keep your lightning sats seperate from your long-term savings? I move my lightning sats to my on-chain hot wallet when I reach a predetermined amount, and I move BTC from my hot wallet to cold storage when the hot wallet reaches a certain amount. This method has worked out really well for me in maintaining an active spending wallet, while also continuously increasing my long-term stack. #bitcoin
Discussion
I do almost exactly the same. LN wallet > on-chain hot wallet > BTC cold storage all at predetermined amounts. It keeps things moving along and my stack growing. What I haven't paid as much attention to (yet) is consolidating my UTXOs. As I'm not really spending my BTC it's not a challenge, but there's some logic in consolidation UTXOs now while it's cheap to do so. Thoughts?
I think it depends on how much you're holding. Consolidation may not make sense if you've got less than $10-15k, but over that it could make sense depending on the cost of the consolidation. But it also might be more trouble than it's worth. Say, if you have 1btc, what you save by consolidating may not be worth the hassle. It really depends on if you're trying to eek out as much value as possible, or if you're OK with just writing the expense off as just another inconsequential fee. This is all to say there's no single right answer, and it depends on your personal style and priorities.
I never thought much about it then I started buying daily on my DCA. This does need to be handled. For now I just let it accumulate till there is a nice chunk in my hot wallet, then every month or so I move it to cold.
I also now have a @bitkey and it has a consolidation tool that tells you up front how much it will cost to go to 1 utxo
You should also consider the effect consolidation will have on your privacy because once you consolidate, all your various coins and transactions will be associated with the one address you consolidate to.
True. It could also possible mesh together my non-KYC with a small amount of KYC. Ugh - wish I was 100% non-KYC dang it.
It's not just the KYC issue. Anyone can look at the blockchain, and see which addresses are engaged in which transactions. Mapping out these records can reveal a lot of about the people behind them. Consolidation makes this arduous process exponentially easier. The principal of security through obscurity, which is often the only thing protecting the identity and behavior of bitcoin users is essentially obliterated as a result of consolidation.
Yeah. I buy in small quantities by doing DCA in P2P LN. Sending to hot LN custodial wallet. I accumulate an adequate amount and send to non-custodial LN wallet (Zeus - Phoenix) and then using Boltz send to Hardware Wallet
I'm somewhat similar. My DCA purchases go to my Nunchuk wallet, and when a certain threshold is reached, coins are transferred to my offline, watch-only wallet. I make seperate, occasional purchases of lightning sats which go to my Minibits wallet for use in zaps and small-value purchases. Sats I earn through zaps and thrifting & flipping also go to the Minibits Wallet. When the Minibits Wallet reaches a certain threshold, I'll transfer the sats to my Nunchuk wallet, where they sit until it's time to transfer them to the offline wallet. This process has been very helpful in maintaining liquidity, and automatically saving.
Yes I do.
I'm glad to others are using a similar system to structure the savings process. I think when you have a clearly-defined system that you abide by, it relieves the pressure of constantly thinking about when and how to effectively stack their sats. You follow the process, and everything just happens!
Nice advice here and I do the same.