What is Dollar Cost Averaging (DCA)? Why does it help you create long term success in the cryptocurrency market? Listen in as as we discuss this foundational strategy for creating long term wealth in cryptocurrency.

Sites for investing via DCA:

Swan Bitcoin   US

River Financial US

Amber App  US & AU

https://www.getbittr.com/ EU

https://relai.ch/  EU

Some centralized exchanges that offer DCA

Binance, Binance.US, Gemini, Coinbase, Kraken

Hey, everyone. No one on this podcast is a financial advisor and all information presented

on this podcast is for informational purposes only. Now that we have the legal stuff out of

the way, let's jump on in. Welcome to the Generational Wealth with Cryptocurrency podcast.

I'm your host, McIntosh, and today we're going to be talking about dollar cost averaging.

All right. So first, what is dollar cost averaging? Dollar cost averaging, or DCA,

is simply a long-term investing strategy where an investor regularly buys small amounts of an asset

over a period of time without regard for the price. For example, maybe you invest in Bitcoin

$100 a month every month for the year instead of dumping $1,200 into Bitcoin at the start

of the year. You can change your DCA schedule over time, and it can last for a few months,

or it can last for as long as you want, for many years. How much? That's going to depend on you.

That's going to depend on your investment strategy and the amount of capital that you have to invest.

If you're only investing $100 a month in all of your investments, well, then your DCA for Bitcoin

may be quite low, or for crypto in general may be quite low. If you're investing $1,000 a month or

$2,000 a month, or maybe more, then maybe the amount that you're DCA-ing into crypto is

quite a bit higher. That, of course, is strictly up to you. Now, one thing you should keep in mind,

even though crypto may have a higher upside, it is more risky than traditional investing

in real estate or stocks. That is something you should keep in mind, and you have to determine

for yourself what you're willing to do. However, if you are investing in crypto,

DCA is, frankly, the simplest way to do it. I have emphasized repeatedly,

certainly this podcast is not about trading. We're not day trading stuff here. We're buying

assets that we are holding for the long term, and that is what we're looking at. This makes it

simple. It makes it so that you don't have to try and time the market. You don't have to time the

market. You don't have to try and figure out, is it going to dip next month? If you're looking at

Bitcoin, maybe is Bitcoin going to dip next month $1,000 or $2,000 or $5,000 next month,

and I'll buy it then? You just determine how much you're going to spend over the next year

or over the next six months, and then you divide that by, say, six months or a year by 12.

That's how much you implement, or you could do it weekly even. Maybe you're only putting

$5 a week into Bitcoin. $5 a week can add up to quite a bit if you do it over the long haul.

How do you do it? You can do it manually, certainly. You could go to whatever your

crypto exchange is, and maybe you do it on the first of the month, and you go in there and you

buy your $100 or $500 worth of crypto. Notice, I'm not talking about a specific asset. Maybe you just

buy all Bitcoin, or you buy 50-50 Bitcoin and Ethereum, or I don't know, maybe you're buying

10% Bitcoin and 50% Ethereum and 40% Cardano. I don't know. That's up to you, of course.

In just a minute, we're going to talk about some automated methods of doing DCA. A lot of these

will only apply to Bitcoin. I'll point that out where that's the case. There are some setups

where you can buy other assets as well, of course. It's an innocuously simple method,

and I've literally just described it in five minutes, but it's super, super powerful. Remember,

we're looking at the long-term, so we're looking at investing over the next five to 10 years.

We're not looking at trying to get immediate returns. Even if I'm only investing $5 a week,

over the long haul, that can add up, and you can get some nice gains out of that. Now,

are you going to retire early from that? Probably not. Maybe, but probably not.

But you need to invest what you're comfortable with. It doesn't matter the amount. Whenever you

make a purchase of crypto, there's going to be fees involved. If you're buying on a centralized

exchange, maybe they're charging, I have no idea, 3% or something to make that purchase.

There's not a way around that. Even if you're using a decentralized exchange,

there's different fees. If you're using one of the other tools that we'll be talking about in

just a minute, there's fees for that. There's always fees. Of course, if we're looking at

investing over the long term, we want to minimize those fees, because the more that we keep in our

Bitcoin or Ether, the more that we're going to have in our investment portfolio over the long

haul. We always want to minimize those fees. It's something to keep in mind, but it's not free.

What are the tools? How can we do this? If I don't want to depend upon myself for

making some mark in my calendar, what are the tools that I can use to automate this?

There's two ways. There are specific tools out there to buy crypto, typically Bitcoin.

For example, Swann Bitcoin is probably one of the most well-known ways to set up DCA.

They only deal with Bitcoin. They do have fairly low fees. There's one place to start. Another one,

and Swann is in the United States. They say that there are other places as well. Not sure about

that specifically, but certainly for US citizens. For people who live in the US, you could use Swann

Bitcoin. There's an app actually from Australia called Amber. You can do DCA with Amber in the

United States and Australia, so you can take a look there. It's amber.app or swannbitcoin.com.

Amber.app. The next one is River Financial. That's River Financial, and they are actually

at river.com. That's a US only DCA app. Then the next couple are for the European market. They're

actually both based out of Switzerland. GetBitter, and I don't know if that's really how they

pronounce that, but it's getbittr.com. Then I'll just spell this one. I have no idea what this word

is. R-E-L-A-I dot C-H. Both of those are European based, and they are both Bitcoin only, as are the

other three. If you want to dollars cost average something besides Bitcoin, and I certainly would

recommend if you have a portfolio beyond Bitcoin that you do that, you've got two choices. You're

going to have to go with an exchange, which a number of the exchanges do support DCA and automatic

DCA. Binance, Binance US, the Gemini exchange, Coinbase, and Kraken all do. I know that.

There's probably others as well. You can check with your exchange, or maybe you need to open

up an account at a new exchange. It doesn't cost anything. It doesn't hurt. It might be something

you want to consider. One of the other things that you can do is use a DCA bot. I don't really

recommend this, certainly for people who are just beginning, but it's a way that you can purchase

even from exchanges that don't support DCA. It handles it for you. A bit trickier,

probably a bit harder to set up. There's an additional cost.

There are the three ways that you could do your dollar cost averaging. Over the last several

months, we've gone over quite a bit of information about the crypto space, about why you should

invest, what currencies are out there. I've given good overviews of the three major currencies,

which in my opinion are where anybody should be starting. Now, these are some ways

that you could actually go out. Please, maybe you're super excited about this at this point.

Maybe you are doing well financially and you just want to throw a bunch of money into crypto.

I appreciate the enthusiasm. My suggestion would still be $2 cost average. Let's say,

for example, you were going to invest $12,000 just to make this calculation easy.

$12,000 just to make this calculation easy in crypto. Don't go and buy $12,000 of anything

right now. DCA it. Yes, you may lose a little opportunity. You may have opportunity cost

because maybe the market's going to go up over the next three months.

Obviously, you don't have it all invested, but you may save yourself as well. Historically,

DCA has performed very well. Coming into this market and just getting started, you're not going

to know all the ins and outs of everything. I would not recommend, even if you were serious

about this and you were going to invest a large amount of money over the next few years,

over the next few years, I still would not recommend that you just drop all that in all

at once. I would recommend that you DCA in, that you say, oh, I'm going to invest 12 grand over

the next 12 months, so I'm going to DCA $1,000 a month. That's my suggestion. It's certainly,

well, it's what I would do. Now, if the market shoots up over the next three months,

you may regret that, but here's the thing. I've certainly been through the last market top.

Back in late 2017, let me just give you an example. Around this time in 2017,

the market was going up and it was going up. Things were looking great. The last quarter of

2017 did very well. I think 2018, early January, early January was considered to be the top

of the market and it went down a lot. In some cases, upwards of 90% or more for some coins

and it went down very fast. Now, if I had joined in October and maybe, I don't know what the prices

are offhand, maybe I should have looked it up before this recording, but if you joined,

just as an example, and I have no idea what it was at the time, I don't remember, but let's say

Bitcoin was at $10,000 when you bought in and then it went up to $15,000 and that was the market top

in January. Well, that sounds like you should have gone all in back when you started,

but then the market dropped and it went below $10,000. Relatively speaking, it went quite a

bit below and if you would have DCA'd, yes, your first two or three payments would have been

before the top, but then as it went down, you would have continued making payments and as it

kept going down, you would continue to make payments and you get this stair step up and

then you get a stair step down, but you're just buying in, you're just doing your thing and then

all during the period of the next couple of years, when it stayed down, you continued to buy and then

when it took off, maybe you're still buying, but you've been buying at these very low levels,

you bought, oh, at the top there, but then it dropped down for quite a bit, year and a half,

two years and the whole time you're buying and the whole time you're creating future wealth

for your family because yes, the market went down, but the market's going to go back up,

the market's already gone back up, we're well above those highs and the market's going to go up.

I mean, all you got to do is back out and look at the big picture, right?

We're always, oh, this month is up, down, sideways, whatever, just back out, just back out.

Bitcoin been around since 2009, 2009, go back, it's up, go back, it's up, go back, right?

And yes, I cannot tell you what the future will hold.

I do not know what the price of Bitcoin will be in December, I do not know what the price

of Bitcoin will be in another 12 months after that or 12 months after that, but based on what

I've seen, based on what I know about the space, I do believe over the long term, it will be going up.

And as it goes up or down or sideways, I will continue to invest in it, Bitcoin, Ethereum,

some of these other coins, because in the long run, if they're solid projects,

if they're doing things and creating value, and that's the key, many of them will go up.

So don't try and guess the market, don't try and figure out where the top is. We can have some

general discussions about when we think the market top is, where, don't tie your financial future to

guessing that top, just DCA, just keep DCA, figure out for this year, I'm going to do X amount,

whatever that is for you. And maybe if you're early in, don't even look out a year, look out six months.

Now six months from now, we may be going down, I don't know. It is possible this market cycle

continues longer than the other two months, but I don't know, I don't know, I don't know.

It is possible this market cycle continues longer than the others have in the past, in 2022,

so next year, this run keeps going. That remains to be seen. If it keeps going, I will keep buying.

If it goes down, I will keep buying, because I believe over the long run, it's going to go up.

Now, you may not be fully bought into that belief at this point, and that's okay.

All right. So that's it for DCA. And that's it. That is, I mean, so however long that conversation

took, 15 minutes, that's it. That's simply the strategy. It's that simple. It's so simple,

anybody could do it. And don't let its simplicity fool you. It will perform very, very well. Now,

would it perform the best as maybe a highly-tuned algorithm that no, but what it does is you don't

have to stress. It's not a full-time job for you. You don't have to worry about it. You just keep

DCAing. Yes, I know, things are doing this, that, the other. No, I'm just doing my DCA.

I keep my eye on things. I understand what's going on with whatever the currencies are that

I'm involved in, because, hey, sometimes things don't work out. I will give you an example.

XLM, I was just talking to somebody about this yesterday. They actually brought up XLM

several years ago, in 2016, 2017, if I remember correctly, certainly in 2017. I had bought

pretty heavily into XLM. I thought XLM was a great cryptocurrency. I thought it had a lot of utility.

It was designed as a way to move transactions between companies, between nations, super-fast,

very low transaction fees, ticked off all the things that I was looking for at that time

in that token. I bought into it. I've actually probably owned more XLM, certainly in number,

XLM is not a very high value token. Back then, it was really low. Regardless, I had a huge

number of them at one point. The reality is that even though the project has all the right

concepts, had some buy-in from, IBM joined. They were doing research on it and had plans

on utilizing it. If you look at the price of XLM, it's not gone up, not orders of magnitude,

not 10X or whatever. If I would have kept my money in it over the long term, that would

have been a mistake. At some point, I chose to exit from that and move it into something else.

I believe I moved it back into ETH. It doesn't matter. Just because you pick certain things,

it doesn't mean you can just ignore this. You are your money manager. You're in charge

of your crypto portfolio. This is not a 401k that somebody else manages for you. The good

thing is that gives you control over it. The bad thing is that gives you control over it.

The bad thing is that gives you control over it. Keep that in mind, but at the same time,

you don't have to worry about all the day-to-day drama, which is always going on. In fact,

we're fixing to talk about some of it in the news section. It lets you be a little more

DCA, a little less stress for US citizens. It means you don't have to worry about taxes.

If you live in the United States, you have to deal with capital gains taxes. That happens every time

you buy or sell, not buy, although you do have to report them now, if I'm not mistaken.

I'm not a tax expert. Please consult your accountant. I do know that when you sell one,

that is a taxable event. Moving it into stablecoin is still selling it. I may sell some ETH and buy

some, I don't know, Bitcoin, or I may sell it to stablecoin, let it sit for six months,

and then buy back in at another level. That's still a taxable event. Doing a DCA where I'm just

long-term adding to my portfolio, that's not creating these taxable events. It removes that

as another stress point. Moving on to the news, lots of news this week. I actually could have

mentioned this one last week, but it was still unfolding when I recorded, and I didn't. Evergrand

in China, you guys, a lot of you have probably already heard about this. They are either the

biggest or second biggest. I believe they're the second biggest real estate company in China. They

own all kinds of assets there, real estate assets there in China. They basically become insolvent,

from what I can tell. They're $300 billion in debt. That's pretty clear.

On Monday of last week, it caused a severe drop in the stock market in the US and also caused a

dip in the crypto market. I think, if I remember correctly, starting late Sunday night and certainly

continuing into Monday. That was exciting. Lots of China news. There's China, they call it China

FUD, if you're uncertain, need doubt. There's even more China news, which we'll get to in just a

second, but in between, we're going to talk about Coinbase. Coinbase had a deal. They were looking

to provide a service to their customers where you could park your money in a stable coin,

and it would generate interest of, I think, like 4%, which these days in the US market,

well, in virtually any market that I know of, is if you have your money sitting in a bank,

you don't get that kind of interest. In fact, I guess in Europe, you get negative interest.

It's very near zero in the United States, so very low. Well, because of being in the business at

their end and that kind of thing, Coinbase is able to offer this at 4%. Excellent deal. Something

that I might look at myself. Well, the SEC came along, Gary Gensler, Chairman of the SEC. So for

those of you outside the United States who may not know who he is, he is the Chairman of the

Security and Exchange Commission. That's what I mean by SEC. He came out and said, if you guys

implement, and he pretty much said this exactly. He said, if you guys, if Coinbase implements this

program, that when a user parks their capital inside Coinbase, and Coinbase gives them a 4%

annual percentage rate return, we're going to sue you. And we being the SEC slash US government,

not a threat to be taken idly. And even though Coinbase is this multi-billion dollar net worth

company with huge amounts of assets, and I'm sure multiple lawyers on their payroll and all this kind

of stuff, they kind of hemmed and hawed around and said, yeah, well, okay, we won't offer that.

And they chickened out. And I understand why, but they gave in. And so that's actually a pretty big

deal. I don't think that was done the right way. I mean, if I understood correctly, if I remember

correctly, Gensler basically tweeted this and said, hey, if you do this, we're going to sue you.

I'm frankly not very professional. I want to kind of have a separate episode at some point

about regulation. The crypto market does need regulation. I don't want to come across as saying

that, you know, there needs to be no regulation. But in my opinion, this was not appropriate.

This was stifling innovation. And from everything that I've seen, a lot of innovation in the crypto

market comes from the United States. Not that it doesn't come elsewhere, but a lot of it does come

from the United States. And if the US government continues down the path of trying to stifle the

innovation that is happening, listen to me very carefully. It will not be good for the US economy.

And the reason why I say that, because it is becoming easier and easier for people to

get up and leave and go somewhere else or move their company somewhere else. They don't even

have to leave. You can set up a business anywhere in the world. You don't have to do it where you

happen to be located. There's plenty of regulation and rule of law around that. It's called an

offshore company. And there's nothing illegal about it. And frankly, if I were setting up

a crypto company, I would think very carefully about putting it in the United States. Now,

I'm certainly not threatening the United States, not my business. But I just kind of thought that

was, and this is not the first, you know, you've got the IRS saying,

making it onerous to manage crypto. It is a capital. They consider it, you know, if you trade,

when you trade, that's capital gains. As an example, there are many locations that do not.

Portugal comes to top of mind. There are a number of European locations. There's places like the,

there's an island chain. I'm sorry, I'm probably going to butcher this. In the Indian Ocean,

off the East coast of Africa, the Cecilies Island. And I apologize if I miss said that.

El Salvador, it's, you know, they, they are welcoming people to come in and create crypto

companies because they know that that will bring capital into their country and they will give

jobs to their people who desperately need it. But you know, in the United States, apparently they

don't want that because they're worried. I, I'm not even sure. I can't even wrap my head around

it, to be honest. I don't understand it. So anyways, maybe that was too long an explanation,

but that happened this week. And then another China thing happened on Friday morning.

China came out for, I don't know what number of times, but it was, you know,

a number of times. And I'll get back to that in just a second. And they banned Bitcoin.

They said that private individuals could not own Bitcoin businesses. You know, earlier this year,

we had the shutdown of mining, which they seem to be serious about that. That has all moved out.

Really didn't, I mean, it caused a market drop granted, or it certainly helped with that. But

the market hash rate or the hash rate for Bitcoin has actually climbed back up. It's not

completely back to where it was back in April, but it's close and it will recover. But now they're

saying, well, people can't own Bitcoin. Basically you can't buy Bitcoin. You can't sell Bitcoin,

whatever. China has been doing this for a long time. You can go back to, I think 2013

and China was banning Bitcoin. Now I saw Twitter saying, showing how much Bitcoin

the Chinese government actually owns. It was a staggering amount. I do not know if that's true.

I don't know. I don't know if they own Bitcoin or not. It wouldn't surprise me if they did,

but again, they've done that. So that caused a little dip in the market. Now it wasn't a huge dip,

probably because like I said, this is not the first time this has come around.

And I don't know if they'll allow it or not allow it. They don't allow a whole list of things. So it

doesn't really seem to be hurting the companies that get delisted. Like, I don't know, Facebook,

I think is not allowed. Google is not allowed. Whatever. It's just another thing. And

they're just keeping their people from being able to have access to that financial advantage.

So that happened on Friday morning. And then on, I think this was Friday. It might've been,

I think it was Friday. Sorry. It's been a really busy week for me. So I try and keep notes and I

do keep notes, but sometimes I write down things after the fact and maybe it's not well. So Friday,

Twitter, the Twitter platform, pretty much everybody's probably heard of Twitter. They

enabled tipping in Bitcoin. Now, what that means is that if I go on Bitcoin and say, I really like

somebody's Twitter thread that they posted, or maybe I just like in general, what they've done

over some amount of time, I can now go and tip that person and I can do it using Bitcoin and it

works over the Lightning Network. It's really cool. It's not, you know, this is not groundbreaking.

Well, it's groundbreaking because they're the first big company to do this. The technology that

they're using is actually, well, it's the same technology that's empowering El Salvador.

We've discussed the sending of remittances back and forth or the sending of money back and forth,

you know, between El Salvador and other places. It's the same technology. So there's nothing

groundbreaking in that sense. It's groundbreaking that Twitter used Bitcoin. Now, the CEO of Twitter,

Jack Dorsey, also co-founded and owned Square, another company that's a payment system,

and that company owns Cash App. And that very easily could have been integrated and they chose

not to do that. And I think that was a very conscious decision. It had to have been.

And they chose to use Bitcoin. They chose to use the Lightning Network. And I think that is great.

I do not think that Twitter will be the last one to do that, just like El Salvador will not be the

last country to use Bitcoin as a legal tender. So that, in the long run, may be the biggest news of

the week, in my opinion. So that's it for the news, a lot of news. And that's it for this episode.

I hope you guys have enjoyed it. As always, you can send me email at mcintosh.fintech.gmail.com.

Hopefully, in the next couple of weeks, I will be able to get some other things set up,

maybe a website. I'm not sure completely where I'm going with this, but something a little more,

a little better than a Gmail, a little better than a Gmail email, but certainly you can send

me email there. I'll get it. And if you got questions, comments, I would love to have reviews

on the podcast. They really would help get some visibility. We are getting traction.

We've got people who are joining every week. It's awesome. I love seeing, especially,

I was looking at my stats earlier today and it was very obvious that somebody had found us

and not only found us, but they went back and watched every episode or downloaded all of them

to watch. So that was awesome. Love seeing that kind of stuff. Hope this is helpful.

Would love to hear from you, topics you might want to hear about. So you guys go out and have