Why I buy Bitcoin every Friday

Stacking the sats

I make no secret that I regularly buy Bitcoin, on Fridays in fact. And since I’ve been asked several times “Why Friday?” I thought it best to write up my reasons. First of all,

I STARTED BUYING BITCOIN A LONG TIME AGO

but how long? Well, back then there weren’t any organised exchanges. Keep in mind Mt. Gox appeared July 18th, 2010, announced via a rather cryptic message on Bitcointalk.

Less than one year later Mt. Gox had been hacked with a significant number of Bitcoin stolen. While I wasn’t impacted this taught me an effective lesson

AVOID CRYPTOCURRENCY EXCHANGES

So in my early days the only way I would purchase Bitcoin was — paradoxically enough — by means of a face to face transaction. Go to a meeting of a Bitcoin interest or user group, meet some people selling Bitcoin, buy some Bitcoin. And for me buying meant

HAND OVER CASH AND RECEIVE BITCOINS

Have a drink — or two or three!! — while waiting for the transaction to clear, and you may have made a new friend for life. Or at least a reliable counterparty for future Bitcoin purchases. It may seem odd now, but

DUE TO THE LACK OF TRUSTWORTHY EXCHANGES

we had to conduct our transactions face to face. Of course there were sites such as LocalBitcoins (founded in 2012) where you could do a transaction remotely, but I wasn’t super comfortable transacting with people I hadn’t met simply because — as I always say —some people get weird about money. It wasn’t uncommon for folks to accept a payment then not deliver coins, ghosting and blocking you for your efforts. It was around that time we saw the emergence of hardware wallets. This reduced the risk of holding Bitcoin significantly, simply because you no longer had to keep your coins with a possible untrustworthy intermediary (aka, “exchange”) or on your own computer, which, of course, could be hacked any number of ways. And frequently were. A hardware wallet allowed me to generate and distribute a receiving address, after which the wallet was disconnected from the host computer. Risks of being hacked were much, much lower, so our confidence in holding Bitcoin was, of course, increased. But the question was

WHY DO I BUY BITCOIN ON FRIDAYS

Well, purchasing Bitcoin back in those days was a relatively high risk activity. Trying to find a reliable counterparty took effort, and once you found someone you tended to stick with that person, regardless of how much of a premium to the Bitcoin spot price they might charge. Once you had your Bitcoin what to do with it? Before hardware wallets you had to keep your coins either on an trustworthy exchange, use a paper wallet, or a software wallet on your own computer. And there were always the scams and people pushing links your way to contend with as well. All in all,

BUYING BITCOIN BACK THEN WAS RISKY

so risky that I would only engage on Friday evenings. And to fully explain this you’ll need to know a little about my personal life. Happily married, my wife and I live in Lovely Essex, England. I do all the cooking at home, but Friday nights are special, because we head out for dinner and an event you might call “date night”. Nice food, some wine, come home a little sloshed. Netflix and chill with more wine and generally after midnight or so The Wife is sleeping on the couch. Put on some tunes and, of course, more wine. Finally, well after midnight

ALCOHOL HAD DESENSITISIED ME TO THE RISKS

of buying Bitcoin, so it was time to engage. So that might mean head out, to a club or a pub where I could meet someone, have some drinks and buy some Bitcoin. Or, in later years after I had some trustworthy sellers, contact someone, get a quote and buy some Bitcoin. Make sure it arrives in my wallet and be done for the evening. Either way, back then it was risky. So I had to desensitise myself to the risks before I engaged. Fast forward to the past four years or so:

NOW THERE ARE TRUSTED EXCHANGES

in particular in The UK where they are registered with the Financial Conduct Authority, or FCA. Of course that doesn’t mean something dodgy couldn’t happen with coins left on an exchange, so I always use a new receiving address to transact. This is best practice as I discussed here

Oh! Because it’s not as risky as it used to be I now tend to purchase Bitcoin in the morning. A country boy, I have a lifelong habit of waking at 0400 without using an alarm. On Friday mornings one of the first things I do is push some cash to my exchange. Always the same amount of money, every week. This is called “Dollar Cost Averaging”, and it is the single best way to purchase assets whose value changes due to market forces.

By the time I’ve made some coffee almost always the money is safely in my account on the exchange, and I’m ready. Buy some Bitcoin and hopefully it arrives in my wallet before I leave for work at 0630. So

THAT IS WHY I BUY BITCOIN EVERY FRIDAY

Is it risky? Yes, lots of regulatory uncertainty around Bitcoin these days. But in terms of sourcing a seller, buying and taking possession of Bitcoin into a wallet fully under my control, far, far less risky than it was years ago. That leads us to

AN IMPORTANT QUESTION

Are you holding Bitcoin? Are you buying Bitcoin regularly?

Why not?

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