It's that time again.  That time where people you may know irl: family, friends, coworkers, reach out to you about Bitcoin and if they should buy.  Random people online asking if they should buy now, how much should they buy, should they lump sum, or DCA?  There are varying opinions if we are still early or if it's getting late.  From what I've seen, the large consensus is that we are still early, but for the common goal of acquiring one Bitcoin seems to be leaving the station.  

Asking "Should I buy now?" is a question that creates a frame of timing the market.  "What if the price drops in the near future and I can acquire more?" What if it doesn't?  This perspective ignores time in the market. Data shows no matter when you buy, if you hold long enough you will have made gains on your initial investment.   This graph by glassnode shows that the colder colors that represent longer periods of holding Bitcoin are pushing down warmer colors which represent shorter period of holding Bitcoin.  Thus, the longer you hold Bitcoin, the greater the chance that you will have made gains on your earlier buys.  On a long enough time frame will it really matter if you bought in at $120k vs $110k? And what if you're waiting for that sub $100k price that never comes?

The Race to Acquire 1 Bitcoin

Overall I believe we are still early, but for newcomers, or those stacking to acquire one Bitcoin who may be fearful that they may not reach that goal, I offer a shift in perspective: acquiring enough Bitcoin so that you have the equivalent of a block reward.

The current block reward is 3.125 BTC generated every 10 minutes.  The next halving, now about less than 1000 days away, will reduce the block reward by half, making it 1.5625 BTC generated every 10 minutes.  Given the current price at the time of writing ($119,339) this may still seem like a large task for those still trying to reach one Bitcoin or those who are just starting to stack.  It may also seem daunting when looking at the the increase of Bitcoin's price in USD at the time of each past halving as seen in the chart below.

For the 2012, 2016, and 2020 halvings, that has been a 9,315%, 2,941%, and 682% increase in price respectively.  If you were to buy the amount of Bitcoin equal to the block rewards at the time of these halvings, they would cost you $308.75, $8,131.62, and $55,133.87 respectively.  With the current price around $117,885, the current block reward would cost you $368,390.62.  These are massive increases.  I don't know about you but I don't have that kind of cash to plunk down.  Instead, this is where stacking sats comes into play.

Overcoming Unit Bias

Although past behaviors don't guarantee future performance, if you believe Bitcoin's price will continue to rise over time, it is safe to say that accumulating one Bitcoin will get increasingly difficult. However, if we look at the halvings scheduled for 2032 and beyond, the block rewards are reduced to less than one Bitcoin as outline in this chart:

Comparing this chart to Bitcoin's price history at past block rewards, you can start to imagine what the price of a fraction of a Bitcoin will be worth.  There was a point where one Bitcoin was equal to $50k, and now half a Bitcoin is worth more than that. If you start thinking with this perspective and thinking in terms of sats, you can start to overcome unit bias- the tendency to think that one unit of something is the "correct" or most meaningful amount, even when fractional units are just as valid.  You can buy fractions of a Bitcoin regularly, just as you can buy a fraction of a share of Berkshire Hathaway stock (BRK.A $712k), or a few ounces of gold rather than a full bar.  By aiming to acquire enough Bitcoin equivalent to a future block reward, you will have already stacked enough sats to what nation states, banks, investment funds, public companies, and individuals are and will be competitively buying on a daily basis in the future.

It may seem daunting to reach whatever your goal is in acquiring a given amount of Bitcoin, but I think breaking it down into smaller steps and milestones can help give a more reassuring perspective that can deter some FUD.  This is where strategies like DCA can be useful so that you can set smaller goals to acquire a certain mount of sats weekly, monthly and yearly.  Good luck on your stacking journey! 

Thank you for your time and attention.

Please consider checking out my Bitcoin merch (hoodies, t-shirts, stickers, cases, mugs etc.) designed by me using the link below.

Happy Stacking,

B

Bitcoin Merch: https://www.redbubble.com/people/B-21/shop?asc=u