Snip.
Yes there are people that started with the goal of holding bitcoin for a long term but we're unable to due to some factors they fail to account for. Like starting with money that is supposed to used for expenses and also failure to comprehend how bitcoin volatility works , this one thing that push most people to sell at loss during bear season because they have failed to appreciate volatility as part of bitcoin cycle. So it is not all traders that started with the mindset of trading bitcoin.
The failure was due to not taking into account factors such as volatility and funding requirements. High volatility makes many people unprepared to face drastic price changes, they may buy Bitcoin at a high price and then sell it at a low price because they cannot withstand the loss. The wrong mindset in Bitcoin investment can also lead to losses, many people start with the aim of making quick profits, but do not have a clear strategy and cannot manage risks. Therefore, to prevent panic that leads to losses, education about volatility and risk management is needed to help them make wiser decisions when investing in Bitcoin.
It seems to me that if guys come into bitcoin with a mindset (and practice) that they are going to buy bitcoin every week (or whatever their time period) no matter what for at least a whole cycle and perhaps two cycles depending on what happens with the price and the quantity of bitcoin holdings that they had accumulated, then it becomes difficult to understand how they would either be panicking or doing the opposite of what they should be doing.
Sure, guys could have had ended up front loading their bitcoin investment at higher prices, so then they may well end up spending to much time dwelling on their paper losses rather than ongoingly buying bitcoin and bringing down their average cost per BTC.
It is good if there is a plan to ongoingly buy for at least a whole cycle, if not two cycles, to plan to have a job (or income source) for that whole time, and if the income source is lost or the income source diminishes (relative to expenses), then there may well need to be efforts to maintain and/or increase the income source in order to be able to continue to be able to ongoingly, regularly, persistently and consistently buy bitcoin.
So sure, it is likely that some guys come into bitcoin with the wrong mindset and even the wrong plan in regards to establishing their bitcoin position, yet it seems that guys can learn the right mindset and the right kind of practices in order to put a certain level of seriousness to their bitcoin investment.
With any investment (whether bitcoin or anything else) profits are not guaranteed, even if people (even very smart people) are investing with expectations of profits. Just because an investment (including bitcoin) seems logical or perhaps it seems to be the best place that money can be put, the investment (bitcoin in this case) is still not guaranteed to be profitable in the future.
Since bitcoin is not guaranteed to be profitable, you need to chose your bitcoin allocation size (as compared with other places that you can put time, energy and value) with that in mind.
The future of bitcoin is not set in stones, there is not guarantee that bitcoin will behave the same way and give the exact profit that it gave in the past. Because of this unguaranteed nature people should invest with the money for their food and needs. They should use only the
money that they can afforded loose( discretionary income)."The money that they can afford to lose" and "discretionary income" are not the same. The money you cannot afford to lose is a sub-category of discretionary income that you choose it to be. Sure, there might be times in which a guy is ready, willing and able to invest with 100% of his discretionary income, yet I would imagine those occasions to be rare.. since guys need to provide for savings and/or discretionary consumption and perhaps even any errors that he might have made in his expenses.
Otherwise the idea is correct in regards to not investing with money beyond your discretionary funds.. Using non-discretionary money is another level of going too far that we should not have to inform guys of such, even though it is possible to that some guys might make mistakes from time to time and end up spending too much, which is part of the justification for keeping sufficient levels of back up funds.
Sure. Many of us consider that if we are putting money into something then we want to also put time and energy into learning about it too.
There are a lot of ways that folks can make mistakes, so there are likely some folks who invest into bitcoin and they have no clue what they are investing in, and there are others who study bitcoin, so we cannot necessarily inspire someone to research into bitcoin, even if they are already investing into it... I know someone who pretty much lost all of his coins based on failure to look into the matter, and the loss was pretty much caused by the sloppiness. We cannot necessarily save people from themselves.
A beginner that don't have enough knowledge of bitcoin should start buying small so they would not loose much if any dumb mistake is to be made. And along the line they should invest there time and energy in learning about bitcoin and adjust why the buy the more knowledgeable they become.
Even though it should be common sense for any of us to start out a wee bit slower and get used to the new things that we are doing, yet many of us know people who get impatient and even presume that they know everything that they need to do, which may well cause them to miscalculate and/or come out of the gate too hot.. .. Some newbies might have a bit of a presumption that it is good to start out with a lump sum amount rather than some smaller amount, which then their lump sum ends up being more than they can afford to lose, especially if the BTC price immediate goes down after they put their lump sum into bitcoin.
So, yeah, starting out slow and then perhaps even regularly increasing the investment amounts from time to time as the comfort gets better and perhaps as the knowledge increases would be a good approach.
It is possible that prior to investing into bitcoin, a good number of guys had not been paying so close attention to their spending and/or making sure that they were building and maintaining a reasonable amount of back up funds cash, so they also might need to get used to their keeping track of their cashflows in order to also improve their bitcoin investing practices.. and/or adjusting their level of bitcoin investment aggressiveness from time to time.
