If you ask someone what is the right amount of Bitcoin to HODL you will get a range of response. Most of BTC Maximalists will tell you the standard response as "As much as you afford to buy!"
In principal this is a good advice as if you are convinced in long term prospects of BTC it makes sense to invest as much as you manage. However what people don't generally account for is how much of it they should keep for booking profits and how much they should not touch no matter how bullish is the price surge or how grim the bearish fall.
There is no harm in booking profits from time to time but what I want to share with you today is regarding what is the minimum amount which you should HODL for really long term - at least 5 years and if you have the self restraint even 10 years.
I strongly believe that despite 11 years since it's launch BTC is still in speculation phase and there has not been a real practical adoption of crypto. This will definitely change over the next 5 years and the way we use currency will be totally different in the next 11 years and there is a high probability Bitcoin will be dominant in the crypto space.
Next comes the part about how to come at a specific amount. For this we can refer the following guidelines:
- There are 18 million BTC mined as of today. The maximum will go upto 21 million
- About 4 million BTC are expected to be lost forever. This number is debatable but we can take 4 m for calculation sake
- This leaves net 14 million available globally
- World population is over 7 billion today
- This means as a simple average there is 0.002 BTC available per person
If we imagine a future scenario 10 years from now when BTC has established itself as the de facto global currency and all fiats have become defuntional due to several factors like political turmoils, wars, hyper inflation due to poor economic planning etc.
In this case how much BTC you have will define what is the total wealth you possess. Of course gold and real estate will constitute wealth in future but in terms of currency BTC will be used for daily transactions.
It might seem like a fantasy now, but if you had told someone in 2009 that one day BTC will be worth over $10,000 he would have said the same.
So you can short, long, swing trade, leverage trade BTC as much as you want but make sure you keep at least 0.002 BTC stored safely somewhere.
It is just worth $20 in 2019, but what will be it's worth in 2029 only future will tell.