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Not Being Bullish Enough On Bitcoin is a Mistake

In article, Stephan discusses the risks arising from not being bullish enough on Bitcoin.

Not Being Bullish Enough on Bitcoin is a big mistake. Why? You’ll sell too early, and not grasp Bitcoin well enough to get the big picture here. You might not secure the coins well enough, and you might not actually realise the societal implications of Bitcoin.

Not Being Bullish Enough On Bitcoin Means Selling too early

Fundamentally, a lot of people did not truly peer into what Bitcoin is, and this made them not bullish enough. This is a big error, as it pushes them to sell bitcoin too early. While they think they’re being clever timing a top, Bitcoin proceeds to humble them a few years later after another cycle.

Lopp has a great example here:

At time of writing in Dec 2020, Bitcoin is now around $23,000 USD. Selling early is penny wise, pound foolish.

Many people wish they had bought bitcoin earlier, but truth be told: that’s only half the challenge. The other half is actually HODLing it through the long term and not selling it out.

As bitcoin old-timers in the space will tell you, you could have bought early… but then you probably would have also sold early. It takes understanding and conviction.

Not Being Bullish Enough On Bitcoin Means Not Securing it Correctly

It’s a wild roller-coaster. Bitcoin can 10x in the space of a few months, and you can be left very exposed if you’re not careful. A $10k bitcoin stack can quickly become $100k, a $100k stack can quickly become $1M and so on.

Consider the worth of your stack currently, and think about if Bitcoin were to 10x or 20x over a few months or a year. Would you be comfortable with the level of security you have?

If you aren’t bullish enough, and you’re only looking for a 2x and then flip for fiat profits, you aren’t thinking big enough. You should be looking to learn about bitcoin security by listening to SLP such as SLP97 and SLP215 with Michael Flaxman. You should be looking at ways to:

  • Ensure appropriate entropy in your bitcoin seed generation
  • Minimise single points of failure
  • Consider multi signature
  • In the ideal case, use open source hardware and software that has been vetted from a security perspective
  • Learn about how to verify signatures for software you use
  • Learn hardware wallet best practices

Not learning enough about how to use Bitcoin the right way

When we talk about using Bitcoin, we mean using it in a self sovereign way. You shouldn’t be in a situation where you are exclusively trusting or relying on your service provider to give you your bitcoins.

This is not stocks or dollars in your bank account. This is Bitcoin. Use it the self sovereign way.

In practice this means:

  • Don’t leave your coins in custodial accounts. Use sovereign bitcoin wallets where you hold the private keys. Or at least, a quorum of private keys (e.g. you hold 2 of 3 keys, or 4 of 5 keys).
  • Ideally, perform your own validation by running your own underlying bitcoin node. This is easy with Specter Desktop + Bitcoin Core, or with myNode, or other projects e.g. Umbrel, RaspiBlitz, Ronin Dojo, BTCPay Server, nodl etc.

Not realising the societal implications of Bitcoin

Fiat money has cultural consequences that many simply do not understand right now. It’s like we’re fish swimming in the water without realising what we’re swimming in. We’ve grown up in an environment of cheap debt, facing incentives to go into debt or lose.

This drives all kinds of changes in our society that weren’t so obvious pre-1971. Increased welfare statism, increased debt, higher time preference, increased centralisation into managerial superstates, to name a few.

As Bitcoin becomes more widely adopted, society’s return to hard money will drive significant cultural shifts that align with the return to hard money. Listen to SLP51 with Guido Hulsmann to know more.

Conclusion

Fundamentally, it takes knowledge, conviction, and dedication to do this. There are many pitfalls along the way, and it takes work from the HODLer to methodically and skilfully avoid these pitfalls. Of course, we can lament the difficulty and push it off til the future when it’ll be easier. But that is also giving up the huge return potential, and also the freedom and moral imperative of bringing about a Bitcoin Standard.

Do your research and learning, be methodical in your approach, and you’ll be in with a good shot.

Help With Being Bullish Enough

See our web store for guides and products. For many readers of this blog, you’d probably benefit from using Coldcard + Specter Desktop + Bitcoin Core, for which we offer an in depth video guide here.

Or otherwise, if you’re not sure where to start, or want other assistance, we offer zoom call consulting here. Zoom consults are offered on a ‘pay what you think it was worth’ basis. Book a call, then pay us here afterwards.