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Three years ago, a Reddit user made a risky decision: they borrowed $ 150,000 using a mix of personal loans and 0% APR credit card balance to buy Bitcoin.
From June 4 they say that the investment is bearing fruit in a large way.
The investor says that they now have 4.75 bitcoin, bought at an average price of $ 35,000. With Bitcoin trade at around $ 105,000 at the time of the update, their interests are worth around $ 498,750. After having considered the $ 15,000 in interest paid and the original $ 150,000 in loans, they are on a non -realized profit of more than $ 330,000.
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“I have no plans to sell anything about it. Buy and just hold. Return with retirement,” they wrote. The remaining debt, now at around $ 40,000, comes from credit card balance transfers that have 0% interest for the next six to 12 months.
They admitted that they recently eradicated another $ 25,000 balance transfer to buy an extra 0.25 BTC when the price $ 100,000 exceeded, despite the fact that it was previously promised not to borrow. “I was just $ 20,000 leftover balance, but I just couldn't resist it.”
When asked why she not only used income to invest slowly, the investor explained: “If I did alone, I would not have been able to buy as much bitcoin as at the lowest prices.”
They describe their approach as a “reverse dollar cost average”. Instead of buying a little over time, they borrowed a fixed amount when BTC acted between $ 16,000 and $ 35,000 and then repaid in monthly installments.
To critics saying that borrowing to invest is reckless, they answered: “Removing loans to buy assets is fine, as long as you can afford to serve the debt in a responsible manner. Do not take loans to buy liabilities.”
They claim that the tax policy of the US will continue to devalue the dollar. Their thesis: borrow in USD and buy a appreciative assets such as Bitcoin. “The strategy is actually a speculative attack on the US dollar,” they said.
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That was the number one question in the commentary section.
