This article includes my personal Bitcoin strategy for wealth protection and accumulation.
This isn't investing advice. This is what I'm doing.... very carefully.
First up, I believe Bitcoin is the future of money and will be integral to the revolution in governments, control, currency, economics, and human sovereignty.
It's already started... and it can't be stopped.
Just like the Internet can't be controlled or shut down, neither can Bitcoin.
Bitcoin has made the human individual the hydra—knock one down and two sprouts up in its place.
Bitcoin will erode power structures that have survived for hundreds of years through force and resource control.
Bitcoin is a decentralized, uncontrollable resource that gives every human on earth the power to control her wealth, sovereignty, and security.
This power is a much-needed "check and balance" that will bring free market forces to governments worldwide. As more governments collide with their citizen's newfound sovereignty, there is going to be more revolution.
Bitcoin will bring more freedom and prosperity to humanity than any invention in the history of the world.
They can steal or manipulate your gold, silver, business, and home, but not your Bitcoin.
Now to my strategy.
1. I don't sell my Bitcoin
Bitcoin is something you hold forever.
It's not something you sell anytime there's a price hike or dip. Don't do that.
Most people lose money in markets because they are overactive—they buy and sell and take too many actions.
You see this in the stock market just like I saw it when I played poker—the average investor believes he can beat the market or make better than average decisions. This is the same in poker; most players think they are winning players. Most aren't. Most investors don't beat the market.
Bitcoin is the first inflation-proof asset in history. It's the best asset ever created.
It's the first time we've created sound money that is incorruptible by governments, institutions, or individuals. It's the first time we've been able to align incentives so that all stakeholders have the same goals. Bitcoin's open-source model has unlocked true decentralization through a group consensus model.
Bitcoin will go down in history as a pivotal transition in human civilization, one in which the power structures of old started their rapid decline.
Translation: You don't sell bitcoin—you OWN IT.
Owning Bitcoin gives you the ultimate insurance policy and the most important security tool you'll ever own.
Buy and own Bitcoin. Don't sell it.
2. I convert every fiat penny I have into Bitcoin
I'm keeping a little bit of cash in an emergency fund and some in a separate account to use if we have a major market correction in traditional assets (stocks, real estate), at which point I'll go shopping.
3. I leverage my Bitcoin to buy cash-flowing assets
This single idea unlocked the true power of Bitcoin for me when I learned about it from Michael Saylor.
I'm currently earning 8% interest on my Bitcoin holdings through BlockFi.
Coinbase has started prompting me with offers to take a loan out using my Bitcoin wallet as collateral.
As Bitcoin's value increases, I get access to leverage (loans).
When I have a loan out against my Bitcoin holdings, as Bitcoin's value increases, I decrease my debt-to-asset ratio. I can also pay down my loan from my gains in small increments if I need to, though that's not ideal because of number one above (Own Bitcoin).
This financial strategy is going to grow as more people figure it out. This opportunity may go down in history as the most lucrative financial strategy to exist since the invention of personal property and landowners' ability to charge rent.
4. As I use debt to acquire assets, I can turn that cash flow back into more Bitcoin while also paying down my loan
Using this strategy, I protect myself against inflation while continually acquiring more fiat to pay down my debt service, further strengthening my financial position.
As long as I'm conservative in the risk I take on this way, my financial machine becomes more robust as my assets grow synergistically.
And I don't have to sell my Bitcoin at any point during this process!
That's my plan.
This strategy protects me from inflation in the years to come while continually increasing my optionality.
There are risks here, of course.
What's funny about risk is how risk perception is mainly a social phenomenon—people believe things are risky or not if society believes them to be so.
You think flying is dangerous, and you get afraid at the slightest bit of turbulence (I do), but you don't consider how dangerous it is to look at your phone while driving or how dangerous driving is compared to flying.
The same goes for covid fear compared to the fear you should have waking up each day obese. Millions wake up each day unafraid of the risks of obesity and eating processed foods yet cower in fear behind a mask because they are afraid of something the government told them to be afraid of.
This concept applied to financial markets shows in the fiat dollar, stocks, real estate, and bonds.
These commonly accepted financial instruments have more risks than you can fathom. They are also price manipulated and subject to execution risk, regulation risk, competition risk, to name a few.
Yet people will gladly bid up stocks on Robinhood, and institutions will buy bonds that have a NEGATIVE YIELD (meaning they lose money each year and can't outpace inflation) because they are considered "safe" by everyone else.
Finally, just about everyone ignores inflation, which erodes trillions of dollars of wealth each year.
When you understand the risks of the popular assets that people buy, you start scratching your head every time you compare these risks to Bitcoin.
Over time, after you scratch your head raw, you wake up and see the light.
And you see Bitcoin for what it is: the answer.
Every new technology in history was resisted until a critical mass of people accepted it.
The same is happening for Bitcoin.
And we haven't seen anything yet.
My advice to every human alive is to do the following:
1. Buy bitcoin, don't sell it, and protect it.
2. Get your passport
This is the ultimate antifragile strategy for living a sovereign, free, mobile, and option-rich life.
Don't wait until everyone has caught on to complete steps 1 and 2