To avoid devaluing what we hold we need to avoid a 'run on the bank'!
First, I must qualify this blog to tell you I am not a financial planner, nor a banker nor any expert in the financial arena. I am just like any of you but have spent some time studying, watching and over the years in many seminars learning. The best teachers have been personal experience, my former neighbor’s Dad and a few other very wealthy 'caretakers' that came across my path. The one that had the most influence on me was a man, that until he knew we were not after his ‘fortune’, shared a lot of great tidbits of wisdom. First tidbit was never start a ‘run on the bank’ and if one happens do not panic. The market will eventually level out and correct again.
What this translates to is for any of us here in the cryptocurrency world is when you have full access to your long awaited funds; when your blessings arrive at the respective wallet(s) you have designated.. DO NOT be foolish and right away run and send it all to your bank account or debit card. Why? This would be like a run on the bank. YOUR bank. Remember the huge drop in Ethereum? There was that big hullabaloo and everyone went to go sell and the price dropped.. like really drastically? I hear some of you saying “Yes.. but this is different! And.. well I really NEED this and I have every right to take what is mine and do what I want with it. And I've waited all this time!
OK, so you would be absolutely right however when more and more people think like that, we end up with a situation that instead of taking care of what you need to.. it devalues everyone’s holdings and rather quickly so in your mind ‘the end justifies the means’ but reality strikes and you find it barely covers just ONE need.
Imagine if you will that you go to send some of your long awaited cryptocurrency to your exchanger and while in transit from one wallet to your exchanger others were doing the same in similar amounts.. while maybe not huge.. BUT large enough to 'make a difference' in their own lives... and a few others are doing the same.. hey.. the ‘get out what I can while I can’ ... mentality.
Each of these transactions singularly would not be an issue other than maybe with your exchanger or bank if it is not 'normal' for you, but together it acts just like a 'run on the bank' and drops the value of what everyone holds. So what you sent out.. the price you 'thought' you were going to see on your wallet at your exchanger to pull out to your card or send to your financial institution has now been reduced drastically because everyone was doing it at the same time… just like a run on the bank to sell off various currencies.
I hear everyone and I know we all have needs..
-Needs that we have waited a long time to take care of,
-Medications we could not afford, certain medical treatment that would help us,
-A new to us vehicle not even considering a brand spankin’ new one...
-That furnace that needs replacing or getting rid of the drafty windows...
-Getting a computer that WORKS instead of limping along with an old hand me down or just on your phone.
- Or just getting a roof over your head instead of living in your car, someone else's spare room or basement.
For almost ALL of these items you can obtain what you NEED through peer to peer vs taking it out to your bank. Yes, I just said peer to peer. There are places you can spend your cryptocurrency to obtain what you NEED.
Yes, I know you will still need to do take some out but do it S-L-O-W-L-Y. If you do not, your exchanger will likely lock your account if you suddenly pull out a whole lot more than what they have seen you put in or never pulled out that amount before and it will be a lot of paperwork and time to get it back IF you ever get it back.
So, proceed smartly with what you have. Remember, on the blockchain, nothing is hidden, everything is transparent and what you use or take out and send to your bank is a something that you will need duly report and pay taxes on in your respective jurisdictions. It is suggested each of you and that includes all of us be it casual dabbler, aggressive activist, new trader or someone who got gifted some cryptocurrency get sound financial and legal advice from people that understand cryptocurrencies and the ramifications you face in your country and the area you live.
Some of you may have noticed I put down NEED and not want. There is difference. A very smart man who I later learned was a multi-millionaire once told me that when, not if, but when I came into money to only take care of what I NEED to and then sit down with a sound financial planner so I could make it grow vs being like a lotto winner and blow it all. Ross told me about the 6 month rule; figure out what you need to live for 6 months, take care of immediate needs (and that did not include paying off debt all at once but over time as that builds your credit better). It gives you the time you need to allow the pie-eyed “we struck gold” attitude to wane and give reasoning and the sound advice you get from qualified professionals time to sink in. It also gives you worry free time to implement a long-term plan instead of just blowing your seed money.
Words of Wisdom, Jane...thank you ♥
Very well described. A lot to think about it before acting blindly ..Thank you
We think alike!
My analysis recently nailed the bitcoin cash explosion up and have made many profitable calls. Please check it out: https://steemit.com/@haejin
What a wonderful insightful read, by someone that cares about all of us.
Thanks so much for posting this for us!!
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STOPWisdom speaks, Great post Jane
I think it'll be a good idea to take out in small amounts because in most countries we can't buy anything with bitcoin, only in fiat. So, there is no way for us to keep cryptocurrency.
thank you Jane. Great words of advice. Pama
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STOP