Welcome to another Nugget of Wisdom! A free weekly post I send out every Thursday. These are designed to be short and sweet, a quick read to (hopefully) impart some sort of wisdom, or at the very least to get you thinking about something interesting.
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A little mental trick for accumulating more Bitcoin
One of the goals for most people in crypto, myself included, is to stack more BTC. To build a nest egg in one of the hardest and most durable asset classes on earth. One of the problems or difficulties with this goal however is that it’s kinda boring.
It’s not as fun or sexy to stack BTC as it is to dip in and out of alts that are swinging 50% to 500% (or more) a week. It’s also not as fun or sexy to stack BTC as it is to go on a vacation, to go out to a fancy dinner, to go out drinking with mates, to buy the new gaming console, and so on.
I’m not saying that you shouldn’t do any of those things, but there’s an optimal time and place and frequency for spending money on things that are not BTC if your goal is long term wealth creation and, in my experience, most people spend way too much and stack far too little BTC.
My little mental trick that makes it easier to buy and hold BTC is to think of it in terms of its future value rather than the current value of it. Instead of thinking about how every $1,000 invested into Bitcoin is worth $1000, think about how much it’ll be worth when the price of BTC hits $1,000,000.
$1,000 invested at today’s prices will get you 0.00913451 BTC (1000 / 109475).
At a million dollarydoos per bitcorn, that 0.00913451 is worth $9,134.
So every $1,000 invested today is worth $9,134 in future value, or be worth 9.134x more in other words.
Of course this assumes Bitcoin will eventually hit that price, but if you’re genuinely giga bullish on the future of crypto and especially Bitcoin, I don’t think it’s unreasonable to expect.
So every time you’re thinking about punting $50 into a meme coin or whatever, multiply it by 9.134x and then think about if you’re comfortable doing it with $456 of future BTC value.
It’s not a perfect analogy — sometimes the memecoin you buy will go up in value, and the money spent on little life luxuries leads to good experiences in the present moment — but it still works as a way to reel in extraneous spending and gambling imo.
I’m talking about Bitcoin specifically in this post but it applies to everything else: if you want to stack ETH, or an index fund, or whatever, try thinking about it in its future value terms rather than in todays value.
It might help you make a decision that future-you will thank you greatly for.
Thanks for reading! In case you missed it, check out Monday’s post below 👇
Almost four years ago to the day I wrote my first Letter about money. A lot has changed for me since then and so I thought I would write another post and share a collection of thoughts and ideas I have on money these days. Making it, spending it, saving it, all of it.
