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Other Barry 1y ago

If you took out a $25,000 unsecured loan 5 years ago, at 12%, you could have purchased roughly 3 bitcoin.

That monthly payment would be $556.11. Over the course of 5 years you would pay $33,366.60 in loan payments.

Buying $556.11 of bitcoin once a month during that same time period would have amounted to 1.38 bitcoin.

The loan, which gave you $25,000 in capital, has you up with more than double the bitcoin if you didn’t borrow.

Using 25% less capital, buying bitcoin in a lump sum significantly out performed a DCA strategy.

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Discussion

Sergio 1y ago

Ill be damned. Good looking out.

Other Barry 1y ago

Buy the corn now

Sergio 1y ago

If I had any cash I would. But I am fiat broker ser

Lebanese Hodl 1y ago

RISK REWARD

Other Barry 1y ago

Scale to acceptable risk and proceed

TBH 1y ago

If I was single, I would have levered up a little in 2022/2023. But don’t really have regrets from staying humble and stacking sats.

Other Barry 1y ago

For sure: 33k turned into 138k in 5 years ain’t bad.

If you scale the risk correctly, the loan can accelerate your stacking significantly

HitG 1y ago

same

DasFrettchen 1y ago

take into account the risk you incurr. do it if you can, avoid it if you are not on solid ground

hh 1y ago

I personally do more sporadic, but larger purchases instead of smaller ones at a fixed interval, but I have never bought this type of argument, which is entirely dependent on a bottom right before a significant run.

You're as likely to catch a local top and be shown to "lose" against someone DCAing during an arbitrary period.

My point being, these "analysis" are useless and don't prove anything. You can only prove that this or that method performed better or worse against the other within a specific time frame, not in general.

Other Barry 1y ago

Analyses.

You are right, I don’t think this is advisable at a cycle top.

But it you can do it at a cycle bottom the results would be even better.

Deleted Account 1y ago

You’re playing chess when everyone is playing checkers. Great alpha especially if you have monthly cash flow to service debt and never risk selling down your accumulated #bitcoin in this example. I try to stay away from all leverage personally but just my risk profile!

Fabian 1y ago

This strategy works best in the bear market. Right now near ATH I prefer buying daily with a small amount.

HolySats 1y ago

Yes, but this is for strong minded individuals. I work in finance for 15 years and I did this in 2022 and 2023.

But only a handful of clients would be able to manage strong emotions that come with this kind of leverage.

𝖋𝖎𝖆𝖙𝖉𝖊𝖓𝖎𝖊𝖗 (¯`◕‿◕´¯) 1y ago

Who is going to give you an unsecured loan of 25k at 12%?

If you can get the loan, you don’t need it.

Other Barry 1y ago

Lots of people will give you that loan.

If you buy a pristine asset and pay it back with an inflating piece of crap, you win.

Pierre 1y ago

Back from when I did my MBA in my pre-Bitcoin days, I got a line of credit. The bank never bothered to cancel it after I was not longer a student so I’ve been using it since.

I never splurged and never got $25k of bitcoin at once though — in hindsight I should have when it was $17k!

SelfBankt 1y ago

Done this repeatedly in the past. It's a heavy weight to carry but running the numbers, it adds up. Said I was done with it but just done the same with MSTR in an ISA.

Joe Nakamoto 1y ago

Lack of sleep + stress though. It’s not for me I guess