DCA in the Wild West of Crypto: The Tale of the 2022 Bitcoin Bear Market (With Real Data!)

Howdy, fellow HODLers! Ever heard that age-old wisdom "Time in the market beats timing the market?" Well, I took it upon myself to see how bulletproof this strategy really is in the wild, wild west of crypto!

The Data Source

First things first—this is not fake news, partner. I used real, verified data from CoinMarketCap's weekly historical snapshots, starting from the good old times on November 13, 2021, when Bitcoin was at a lofty $64,469.53, to November 26, 2022, when it was at a "humble" $16,464.28.

So what's the Gameplan

Imagine you're braver than a rat attacking a cobra. You decide to DCA $500 every week into Bitcoin during its "Self-Discovery Year" of 2022.

Crunching Numbers While Holding Back on Tears

Yada yada, you know the drill. Let’s see some numbers:

• Total Investment: $27,500 (DCA $500 weekly)
• Total Bitcoin Hoarded: About 0.6975 BTC
• Value of Your Bitcoin Stash at Week 55: $11,484.98 (Bitcoin price at week 55: $16,464.28)
• Percentage Loss on Your Investment: ~58.24% That might sting, but remember, you're still in the game, partner!
• Percentage Loss in Bitcoin's Price at same time: ~74.46% I know, I know. Take a moment.

2023 Plot Twist

Hold your horses! As of 2023, Bitcoin is shining brighter at $26,555. Let's run the numbers again.

• Value of 0.6975 BTC in 2023: A sizzling $18,527.21
• Gain from the end of 2022 to 2023: About 61.32%
• Overall percentage loss from initial investment: Now you're down by just -32.63%

The Moral of the Story

Well, you may have lost some, but thanks to our friend DCA, you lost significantly less than if you had gone all-in during week 1. That 74.46% loss got softened down to a 58.24% loss, and you've got yourself some Bitcoin that's seen the depths of the market and lived to tell the tale.

So, there you have it. DCA might not have turned you into a crypto king, but it sure as hell saved you from living in the New York subway. So next time someone chortles at your DCA strategy, tip your hat, because you're playing the long game.

The bears may have won the battle, but the war? Oh the war is still on. See you in 2025.

Submitted September 17, 2023 at 06:15PM by farmbotic https://bit.ly/3Rqw15J