The Role Of Perspective In Successful Investing
Bitcoin has established itself as a first-class investment asset, a form of property, and even a medium of exchange or a means of value transfer. Some may view it as a form of cash thanks to the introduction of the Lightning Network, which enables low-cost Bitcoin payments on a second-layer solution.
I do not see Bitcoin as cash but rather money. Many would consider them the same thing, but that is not necessarily true. The idea of cash is having money on hand to purchase daily essentials or pay for items and services you need in your day-to-day life. This is usually attained via a monthly wage or salary.
This is generally how cash is viewed, but I believe that money is something else. Have you ever heard the term, “that guy has money”? This does not mean that he is walking around with a big pile of cash ready to buy whatever he wants. It means he has assets valued at a significant amount in dollar terms. This “money” then generates cash for him in multiple ways.
Common Bitcoin Mistakes That Undermine Its Value
You cannot approach the idea and psychology of Bitcoin with an employee mentality. In essence, Bitcoin has posed a challenge to society. A challenge to view money correctly and not merely as an employee living month to month. People who are unable to accept this challenge but wish to hold bitcoin with an employee mindset will most likely not see the benefits of this asset. The correct approach is that of Accumulation and time. Forget about the big gains, unless you are familiar with the market and altcoin trading.
The correct approach will create money for the dedicated and disciplined. Subsequently, it will ultimately generate cash for the holder. Warren Buffett couldn’t have been more wrong in his statement that declared that Bitcoin does not generate income. Without even investing your BTC through a lending or DeFi platform, you can still earn yield if you take the right approach.
Let’s say you have a holding in BTC that’s significant but not massive. Say, for instance, that your salary equivalent for one year is 7% of your holdings. Selling 28% of your holdings as near as possible to a cycle top will now accomplish two outcomes. Firstly, your holdings will now be only 72% of your original BTC-equivalent holdings. Secondly, you now have a guaranteed income for four years.
Once the four years have passed, the dollar value will be significantly higher than when you were holding 100% of your holdings. In the case of the 2017 top, it was 20 times the value of the 2013 top. That removed value has now been replaced in dollar terms and multiplied many times over.
Why Bitcoin Is Different From Traditional Retirement Investments
This is literally the opposite of what transpires in the fiat-based legacy pension plans. Pensioners are afraid to use their allocation because it then diminishes in both dollar and real terms. BTC actually increases as you take from it and then further goes on to completely outpace inflation.
This is absolute genius, and yet people, for the most part, are unable to grasp this economic construct. They still build and plan based on a system that has proven to be a failure with every passing year. Although BTC has not been around nearly as long as the legacy pension plan, it has already proven successful. A 12-year history of a successful cash generator while simultaneously increasing in monetary value, compared to the failure seen on any timeframe of the legacy pension plan!
Why Bitcoin Is Completely Different From The Financial System
Are you able to see the vast chasm that separates the intelligence that these two contrary systems are built upon? Even if you played out the naysayers’ scenario that it may one day fail, would you not currently plan around something that is still working and relevant, rather than something that failed many years ago? Pension plans are no longer viable solutions for longevity.
Mastering Bitcoin Psychology: Think Like Smart Money, Not The Crowd
If you truly understand Bitcoin psychology and view it as sound money, you will want to grow your BTC stack over time. Finding easy, passive ways to build your BTC holdings has become imperative. In a recent post, I addressed a great passive avenue for Bitcoin accumulation. The best way to build your BTC stack is for free, right? Fortunately, the Crypto space is rich with opportunity. One of the best ways for newcomers to stack free BTC is to use platforms like FREECASH and faucets. It’s an easy starting point.
Final Thoughts
Given Bitcoin’s tremendous growth, even at these mature levels, it reveals an asset that will ultimately outperform traditional pension plans. It’s hard money, which cannot be easily acquired or, worse, simply printed at will, as with fiat currencies. It offers a true solution at a time when one is desperately needed. Bitcoin is money! In fact, it is the purest form of money we have ever seen. All the best! See you next time!