That time I almost lost all my bitcoin...
Bitcoiners,
If you want to accumulate as much bitcoin as possible over the next few years, do NOT trade with leverage.
Leverage - any type of trading that involves borrowing money or otherwise increasing the number of shares involved in a trade beyond the number of shares you could afford when paying in cash.
Leverage is a bad idea for long term investing because bitcoin is extremely volatile.
Bitcoin goes through cycles and can experience drops over 75% from the all time high. If you are trading options on a cryptocurrency exchange or taking out bitcoin-backed loans, your entire bitcoin stack can get wiped out overnight.
I am speaking from experience.
I took out a bitcoin-backed loan on BlockFi nearly 2 years ago to buy more bitcoin. The bitcoin price ran up to all time highs while I had the loan then sharply came back down. I almost got wiped out. Luckily, I made some last minute decisions that saved my stack.
Some people don't get that lucky.
I personally know 4 people that have had 90% or more of their savings wiped out by leverage trading.
Which is why I want to share this with you. I want to help you realize the risk involved with leverage trading. There's a popular quote in the Bitcoin community "Stay humble, stack sats".
Do that!
Happy Tuesday,
-Pod
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Eric Podwojski
Founder, Bitcoin EDU
Twitter: @epodrulz
Disclaimer: This should go without saying: This is not financial advice. This is not investment advice. I write this newsletter for education and entertainment. Act accordingly.
