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How Much BTC Do You Need to Create Generational Wealth?Hi Tradingviewers, in this article I am going to break down this question into smaller items and try to give a concrete answer to the question: “How Much BTC Do You Need to Create Generational Wealth?” First, we’ll have to define what ‘wealth’ means. Then we need to define how we look at the ‘generational’ part. Lastly, we also need to take into consideration long term outlooks on Bitcoin. Let’s try and put some actual numbers on this and see how much BTC you would actually need. I’ve been on Twitter a lot lately (putting some more effort into my account!) and got inspired to answer this question as this was a very common topic on Twitter. The interesting thing is that I saw a lot of people talking about this, but nobody actually made an effort to go through the math. Without further ado, let’s dig into the numbers. First let’s look into some options to define wealth. Using data from the World Inequality Database and Statistics Canada), it takes about $488,000 to be considered part of the top 1% in the U.S in 2019. Let’s assume that this applies to the number needed in a family/household. Let’s make ~$500,000 our first option, I’d say belonging to the top 1% in the US would be a pretty fair definition of wealth. If we look further than the US, we can also use this same 1% methodology to define wealth on a global scale. In that case you would need at least $744,400 in combined income, investments, and personal assets according to the global wealth report from the Credit Suisse Research Institute. A slightly more ambitious goal compared to our first option but we could define this as ~$750,000. Another option to look at wealth is to look at financial independence . My preferred way to define financial independence is to have enough wealth such that you can completely live off the dividends. A common rule used by the FIRE community (Financial Independence, Retire Early) is the 4% rule. The 4% can be summarised as a safe withdrawal rate that will not lower your total wealth over the long run. Even when there are temporary downturns in the global economy. This assumes you invest all your money in the stock market. The median household income in the US is $61,937 per year. We could consider a passive income of the median household income as wealthy. If we divide $61,937 by 4% from the safe withdrawal rate above we get to a total of $1,548,425. So using this logic you would need roughly ~$1.5M in total assets in order to be considered wealthy. Now, let’s discuss the generational part. Honestly, I was surprised when I found the exact definition: “ generational wealth represents assets passed down from one generation to the next. If you can leave behind a notable inheritance to your descendants, that constitutes generational wealth. These assets can include real estate, stock market investments, a business, or anything else which contains monetary value. I had somehow expected it would be something more ambitious such as that for x generations they would all have to be considered “wealthy too”. Achieving generational wealth would then be relatively easy given method one and two. You would just need to make sure something is left of your $500,000 or $750,000 respectively. Option three even has it implied. The whole idea behind option three is to never actually spend any of your wealth, you’re simply living off the dividends. This leaves us with the most difficult one: how much Bitcoin would you need? The first and most obvious approach is to directly calculate the amount of bitcoin that represents our different definitions of wealth given the current price. If we take a Bitcoin price of $30,000 that would give 16 bitcoin for option 1, 25 bitcoin for option 2 and 50 bitcoin for option 3. Now let’s bring in some of the nuance. First of all if you’re expecting to live off your dividends you cannot have all of your wealth be in bitcoin itself as it doesn’t pay any dividends directly. Normally the wealth would be in the stock market or in real estate. Also, if you assume that the value of bitcoin will keep rising you would obviously need far less bitcoin today to achieve generational wealth later. For example, Bloomberg analysts have predicted a price target of $50,000 for Bitcoin in 2021, implying a $1 trillion market cap for just this cryptocurrency. JP Morgan analysts estimate the price of Bitcoin to grow more aggressively, as they estimate a value of $650,000 by the end of 2022. Let’s be more conservative on the date, but keep an aggressive price target for the sake of the argument here. If we take a $300,000 price target by the end of 2031 how much bitcoin would you need today to achieve generational wealth? This would give us 1.6 bitcoin for option 1 2.5 bitcoin for option 2 and 5 bitcoin for option 3. Specifically for option three it would still mean though that you would have to cash out all your crypto assets and convert them into dividend generating assets instead. Also, with a possibility to see hyperinflation later given that 35% of all dollars in existence have been printed during the last 10 months it is questionable whether thinking of generational sustainable health should even be expressed based on dollar figures to begin with. I wouldn’t know how to express it in any other way, but am really curious to hear if anyone has good alternatives on this point. I am really curious to hear your views on this. I used many assumptions here, how would you have approached this? Are there any flaws you see in my logic? Feel free to comment on anything, and please feel free to absolutely destroy it! I’d love to have the discussion. Just to summarize, based on this you would need today: 16 bitcoin to be considered among the top 1% wealthiest in the US 25 bitcoin to be considered among the top 1% wealthiest in the world 50 bitcoin to achieve generational financial freedom Trading-Guru p.s. You might have seen a few reposts of this article as Tradingview was struggling with a faulty spam detector. The moderators kindly helped blocking and unblocking some posts. Thanks @scheplick!
BITSTAMP:BTCUSDEducation
by Trading-Guru
11
Generational buying opportunity of BTC?Dear fellow readers! The chart presented above represents my idea of the so called generational buying opportunity of BTC , which recently has come up in the news. I'm not a professional market analyst nor am I a professional trader and this shall definitely not be of any financial advice. Do your own research and try to understand the fundamentals regarding any investment you take into consideration. The websites and projects “advertised” are not mine, nor am I in any marketing or affiliate relationship with them. Personally I am invested into this project, so of course I am biased, that is why I tell you to get educated and do not just put money in anything, because somebody on the internet is writing good about it, scrutinise critically and if you are more than confident, do whatever you want for your good. Regarding the generational buying opportunity, in my opinion there is really not much to talk about, I believe if these or lower levels should be reached before the halving, the market has bleeded enough and finally washed out the weak, being cleansed and able to reach new highs. At least we hope so :D. Before I forget, as far as I know, CME or any futures contracts does not directly influence the price of BTC , it’s influencing it indirectly, because the institutions does not have to be invested into BTC . Okay, that’s downside enough, but it does not directly influence the price of BTC . I guess, the most powerful individuals are the miners. In case of some miners capitulating and dumping the market to upgrade their mining equipment, which by the way will be delivered between 1st and 10th of dec. I do have some concerns about the mining industry, recently I was watching a video on youtube concerning the mining industry. It’s a bit confusing, e.g. bitmain develops new miners, mines with them, develops one or even two new generations in parallel. The old generations are sold to mostly so lalala profitable miners, while bitmain mines with the new generations, while developing the next generations miners, selling the old used ones, is this even profitable enough. My guess is, it’s not profitable now, but if you are in this business long enough even semi-professional, you should have been able to accumulate a large enough amount for backup on your cold storage. Just keep calm, DCA and almost forget about it, this technology in my opinion is made to stay and will not vanish and that's why I guess mining is profitable enough, in case you own a decent sized operation, I do not mean people mining at home with a small rig, just to hope to get the reward by luck, which of course are very important for BTCs decentralized nature. Thanks for reading, If you are not conform with anything I write, just drop a comment and feel free to start a discussion, I do not want my readers to believe all I am writing is fixed on stone, I just try to have a view on the big picture and if I am maybe missing anything, I would be glad to take this piece of information also into consideration. Keep up educating yourself, take your finances in your own hand, short the bankers and long BTC! Cheers
BITSTAMP:BTCUSDLong
by markuso116
1
FTSE 100: UKX Inter-Generational High: Super Cycle only half wayFTSE 100 Inter - UKX - Inter-Generational Cycle High - Half-Way House Nine years from high to low. Nine years from low to High on FTSE in fact the secondary or final rally high set in week of 13.03 00 as Internet generation 1 peaked with Nasdaq and techs' peak reached that week). Low reached March 9th 2009. The next cycle date falls between Friday 2nd March and Friday 9th March. If the major markets break below the lows of last week we can therefore most likely expect a low to form at this point in time - and if they can hold up today and rally from here the next high is likely to be struck in the 5 trading days between March 2rd '18 and March 9 '18. Whichever way it breaks from here should be worth following in the near term - but start to look for a significant change in trend in either event come 2nd March through 9th. Looking even further out in time this peak now is likely only an inter-generational cycle high, marking the half-way point in the old 18 year generation cycle. The real grand super-cycle high (high to super-high) is not reached on this chart until March 1st 2027. Time, as always, will tell. In the meantime, there's a nearer term FTSE strategy outlined below.
TVC:UKX
by sumastardon