My answer to the allocation question

There are so many people (once they've become orange pilled) that ask the question: "So should I go 100% into bitcoin??" "Should I DCA?" "Should I sell all my stocks/bonds?" Basically, what do I do now that I realize that bitcoin is the answer to the broken fiat problem? I've been in bitcoin since 2018 and wanted to share my perspective and hopefully it's helpful to new bitcoiners as they start their path.

First off - do not go "all in". I would say this for any investment, ever. So many people think they've found the holy grail in stocks, just to be shaken out and then eventually sell the company they believe in, often times right before it makes a big leap up in price. You have to understand that often markets (any market) is manipulated in a way to try to have typical investors sell low and buy high. It's psychological warfare that you just need to assume for the purpose of this post that you are unequipped to manage properly. So you need to HODL. But hold what and how much?

If you are truly orange pilled, you need to understand two things:

1. Stocks (and companies) still have value. They are still an entity that sells a product, makes a profit, and employs people. Stocks are just valued in fiat, which is a mistake, but most companies already get this. They don't hold fiat in their reserves, they buy back their stock with profits. Which actually works just fine. Holding bitcoin would be a better strategy but a company's stock price can do just fine if the company is growing, is profitable, and is constantly buying back it's stock or reinvesting in itself. Apple, Google, and Amazon are going to do just fine and you should continue to hold baskets of stocks in ETFs. You need to diversify.

2. Bonds are garbage. Bitcoin isn't replacing the S&P500, it's replacing bonds. Bonds are the preferred fiat investment that's "rock solid" and most people use as a store of value in a way. This is the biggest mistake of the 21st century. With bitcoin, and the approval of the spot ETFs, you now have a way (in your 401k or brokerage accounts) to hold bitcoin. Bonds will never keep up with true inflation. Also, as your country's debt (let's take USA as the example here) continues to climb, the government is going to have to pay for it. They'll increase taxes and make a big splash of it, but it won't cover the bill. They are going to have to issue more and more garbage bonds at higher prices, which means more payout, which means more printing, which means more inflation, etc, etc forever until bonds are 10%+ and anything you might be holding now is complete crap.

So the answer to the allocation question is now simple. It's a 60/40, 50/50, or 40/60 split which should be decided by the person's risk tolerance. Personally I'm 50/50 in my retirement account and then I hold some bitcoin in cold storage and some individual stocks that I believe in with a brokerage account. But more or less, I'm about 50/50 on my liquid investments (take out house/mortgage etc). This has personally helped me in the past when bitcoin dips and stocks surge. You need to have both so you don't make the mistake of selling one to buy the other. You need both and personally, I think you need both equally. The biggest mistake you can make in investing is to constantly buy and sell. You cannot time any market, you need to play the long game, and the long game is high quality S&P500 stocks, and bitcoin. Companies will eventually hold bitcoin which will resolve the issue of worrying about companies that don't keep up with bitcoin (this was Saylor's point of why you should be in bitcoin 100%). But this will shake out naturally. Value will find a home with companies that use bitcoin as a store of value, but this will take years to come to fruition. Don't try to time this, just let it happen naturally.

In this new bitcoin world that we are going to watch emerge in the next 5 years, both stocks and bitcoin will do well, but understand they are both different investments and are both worth your energy.