Buying Bitcoin without having an emergency fund was the biggest mistake you made while starting your journey many years ago, because if eventually you were able to buy with some spare funds that wasn't urgent, you probably wouldn't have sold all and had a few as  Bitcoin appreciated around 2020/2021. But however, I'm happy you learnt from your previous mistake and now holds Bitcoin with an amount you can always afford to lose. So back to the question you just asked above regarding what percentage is best to diversify as a Bitcoin investor. And for me, I will say 80% in Bitcoin is best while our cash should be 20%, because investment is always meant to be higher than expenditure.

Yes Bitcoin is a long-term investment, so it is important to create an emergency fund to manage long-term investments consistently and that means that only if there is a financial obstacle during the investment, the emergency fund can be resolved. The investment can be managed with discipline so that if there is a financial problem, the investment does not have to be completely closed or sold. That is why it is very important to create an emergency fund. Another thing is that the price of Bitcoin is volatile. Another thing is that the future is completely unknown, so we do not really know when the emergency fund will be needed, so it is very important for us to always be careful and be prepared. If we cannot manage our investments consistently and hold Bitcoin for a long time, we will never be able to reach our goals or make long-term profits from Bitcoin. As a result, we will face financial losses.

Any money that will be issued as emergency funds should be readily available and easily accessible. This is because you don't need to pass through protocols to access your emergency funds. Emergency funds should be saved in your local fiat and kept in an easy going account or kept in cash. Emergencies may occur anytime and if you don't have a good support to help you, you can end up selling off your main bitcoin stash.

Leaving your emergency funds as bitcoin can expose a person to losses and this is because emergency may occur at downtime and you will not have anywhere to run to order to selling at loss. This means that even if the amount saved for emergency situation in bitcoin was supposed to be enough for such emergency, you may sell at loss and the said bitcoin will not be able to solve the same problem when it happens. Save your emergency funds in your local fiat and invest in bitcoin for a long-term.

If you do not create a backup fund for investing in Bitcoin, then if any emergency problem you face in the long run, you may have to sell your Bitcoin holding. But I would not say that keeping 80% Bitcoin and 20% as cash is fixed for everyone. Not everyone financial situation, responsibilities and expenses are the same. If a person uses 80% of his discretionary income to buy Bitcoin, it means that he is investing aggressively. If that person has a strong cash flow and there is no instability in his lifestyle, and his expenses are fixed every month, that person can do DCA in such an aggressive way. But if a person has more responsibilities and unexpected expenses are irregular, 80% of his discretionary income may not seem reasonable. At that time, that person will do DCA based on his situation. Even his DCA amount may change every month or week due to irregular income and expenses. It will depend on his cash flow and expenses.

You said it yourself "you learnt the hard way loosing alot cause of wrong order of your investment.

I would say 100% savings in bitcoin without a backup would only make one sell at a loss when there's an emergency fund needed. When thoughts or things like this comes to mind or happens. It's always advisable to do the needful of saving emergency fund elsewhere different from your bitcoin savings. Doing this will save one from being at the loosing end when emergency funds is needed

Emergency funds' coverage might be more than just 12 months of expenses. Especially with persistent inflation these days. Fiat's value is quickly diminishing each day. Perhaps, that's why the OP asked about using Bitcoin as an emergency fund. The only problem is that Bitcoin is not widely accepted by merchants and/or businesses worldwide. Not to mention, it can't be used offline (sort of). This is just like Gold where it can't be immediately spent on every retailer or store you can imagine. Which is why, cash is unmatched when it comes to building your very own emergency fund.

Keep Bitcoin and Gold in a safe place for long-term wealth generation, and only use cash for when you need instant liquidity. The choice is yours. Just don't put all of your eggs in one basket, and you'll have nothing to worry about.

For me bitcoin cant be used as an emergency funds, I consider it as a high risk investment so I should not treat a high risk invested asset as an emergency funds.
Imagine if we are in emergency moment but at the same time the bitcoin price is dropped significantly, selling it means we have to take a big loss.
Emergency funds should be something with stable value and it can be accessed easily, in an emergency moment, few minutes can be very crucial thing.

As I'm not a rich man as well as because bitcoin is not a legal payment method in my country so I will not put larger part in bitcoin.
I will split my funds into 3 parts, like 30% Savings/Cash, 40% in physical assets such as land, 30% in bitcoin and other crypto.
Of course it is not something fixed because other factors especially my economical health may influence it.

That's the thing since bear season is surely going to hit hard if you buy it at a wrong market price right? If you have a lot of leverage since you bought the Bitcoin at a low market price then you could probably make it work, Im thinking about it since it's still a risk if you make your emergency funds as Bitcoin you might probably lose some percentage if you are forced to sell at the wrong timing during the emergency but since it is also a right, it might be the opposite since you might force to sell at a good timing and you end up making more money right?

It might make sense since you are still holding your emergency funds but it was just on Bitcoin technically you didn't give up your emergency funds, as inflation hits it just makes me think if it is worth taking more risk on Bitcoin rather than holding more emergency cash.


For sure this was still the best thing to do long term since there was no guaranteed on Bitcoin investment, we are even not sure if Bitcoin is still going to exist in the coming years so it's still a good thing to still stack up or save cash for long term emergencies, maybe change of plan? complete that emergency funds and then invest it all on Bitcoin, I do not mean to make it your Bitcoin investment, it is still your emergency you just convert it on Bitcoin and put it on seperate wallet?

Many Investors think that saving their emergency fund in bitcoin is the best but it's obviously not the best idea because it's something they will be needing anytime. I know some have good reason as to why they have chosen to keep it in bitcoin and that is due to inflation, but I don't think we need to bother ourselves too much about inflation because it's just our emergency money and we can still use them in the near future so no need of trying to keep it out from the reach of inflation.

So it's high time we understand that our emergency funds can not be hold for long because emergency can happen at anytime that is why we need to keep them in a place that we can easily access it.