Hacker News new | comments | show | ask | jobs | submit login
Show HN: Bitcoin investing using Dollar Cost Averaging strategy (github.com)
170 points by hidiegomariani 107 days ago | hide | past | web | favorite | 120 comments



The re-balancing system (of which dollar averaging is a variant) is described in the Fortune's Formula book [1] as something that Claude Shannon [2] would demonstrate in his lectures at MIT as a mathematically proven guaranteed winning strategy. At the end of the talk there was a Q and A, and the first question always was "do you yourself use this system", to which he replied "Naw, the commissions alone would kill you".

[1] https://www.amazon.com/Fortunes-Formula-Scientific-Betting-C...

[2] https://en.wikipedia.org/wiki/Claude_Shannon


The transaction fees at Kraken and many other cryptocurrency exchanges are percentage-based, so that issue shouldn't apply here.


Note that Shannon did use the word "alone", implying that commissions is not the only reason why this strategy is not as great as it seems at first. I'm guessing he (being one of the most prominent mathematicians of the 20th century) picked this example exactly because it was a counter-intuitive and complex problem that seems simple on the surface.


It would still apply. Them taking a percent of my money every trade hurts me. Is there any guarantee that my profit per trade is larger than their fee per trade?


You pay the same amount in fees for buying a lump sum of $100 in Bitcoin or for buying $100 in Bitcoin over a week using dollar cost averaging. If dollar cost averaging with no fees is better than a lump sum with no fees, then I'm not sure how adding the same fee to both strategies could make dollar cost averaging any worse relatively.


Back then that was certainly true. Today it's easy and free to do using ETFs that are free to trade under certain brokers. Since I'm a boring fuddie duddie, I just rebalance my ETFs and index funds in Vanguard every so often at no cost, but I believe eTrade and some other platforms have a subset of "no commission" ETFs, Interactive Brokers has very low commissions, and if you like startups in the space, Robinhood is technically free (though order fill I hear isn't nearly as good as other major platforms, to be expected).


Robinhood is good for quick smaller trades, but their order fill is horrible. Every time I am shocked at the prices my orders fill at. I'm fairly positive they are making money front-running or from kickbacks from exchanges.


If the desire is to fill index-type ETFs at the market price, yeah, Robinhood is probably not smart. Vanguard is simply better for that. I wonder how the fills are at limit stops? Slower? Don't know who they clear through.

Robinhood seems like a great fit for the person who has maxed a Roth and wants a brokerage to hold on to ETFs across low-ER providers, like Charles Schwab and iShares ETFs + Vanguard ETFs as they accumulate capital.

Beyond that I can't see using it for trading or anything. If I was slanging options or speculating long/short through retail brokers, I'd be doing it on Interactive Brokers and nowhere else. (And yes, I know Robinhood doesn't do short-side work.)


They sell flow to KCG/Citadel/etc like most all (every?) retail broker.


Pretty much. Think they route through Apex a lot as well.

Interactive Brokers is the only way to go for an intermediate person who wants to speculate and have high-powered tools for a relatively low minimum ($10k I believe, $3k or so for younger people under 25?). They refuse payment on order flow, as does Fidelity, IIRC.

Like I said I'm out of that game (minus small speculation on BTC for currency hedging purposes). I've found the love of index funds and low expense ratios.


After reading Flash Boys: A Wall Street Revolt, I think it would be silly of me to not believe everyone is doing some variation of front running.


Plus the formula is more geared towards diversyfing across different assets.


I wrote a bot that did something similar on the cryptsy exchange - it didn't pull in any new cash, it just tried to re-balance every time it ran.

It was making a small profit until cryptsy got hacked and lost all of my coins :(

Here's the source if anyone is interested though: https://github.com/nfriedly/Coin-Allocator


Some years ago everybody involved with the cryptocurrency universe had a relatively good understanding of economics, markets, agent incentives, game theory and so on -- even if these people didn't mention any of these terms, they seem to have a natural, logical, grasp of everything that was needed (not much).

Now it seems that people come to cryptocurrencies without knowing a thing, misunderstanding the way people act and the incentives involved, but at the same time making heavy usage of the terms "cryptocurrency game theory", "cryptocurrency economics" etc.

Not to say that this DCA thing is wrong or anything, but I've seen people here trying to create speculation strategies using charts and correlations produced by Python scripts, and lots the new cryptocurrencies and tokens are deadly wrong on their assumptions and incredibly poor in their features, like Bancor or Tezos.


What's wrong with Tezos?


Nothing wrong, I just think it is silly. It's only feature is on-chain voting on protocol changes, something that wouldn't have prevented the Bitcoin hard-fork, for example. It also assumes hard forks are always bad and that everything can be agreed upon with votes, as if everybody were always satisfied with election results.


>It's only feature is on-chain voting on protocol changes

>It also assumes hard forks are always bad and that everything can be agreed upon with votes

Those two statements are incorrect. If you want to understand what it brings to the table, then you should read the position paper: https://www.tezos.com/static/papers/position_paper.pdf

Or watch a presentation by the lead about Governance: https://www.youtube.com/watch?v=6OWxGqbknFQ


The example says they want to invest $1000 over the course of 3 months, so 1000 / (3 * 30) = 1000 / 90 = ~11$ / day.

But aren't the transaction fees (at least for Bitcoin) something like ~$2 per transaction? So you'd end up only investing ~$820 instead of the target of $1000 and losing the rest. Am I missing something?


Another problem with DCA is that it's a classic case of "timing the market". If, over the course of those 3 months, the value of the asset you're purchasing consistently increases, you'll 'lose' money in the sense that your dollar will have less and less purchasing power toward the end of the period.

There's a good discussion of this strategy on the Bogleheads wiki: https://www.bogleheads.org/wiki/Dollar_cost_averaging#Dollar...

tl;dr: If you think the market will continue to go up in the short term, lump sum will always beat DCA. A better rule, however, is: do not try to time the market. Just invest when you can.


>A better rule, however, is: do not try to time the market. Just invest when you can.

Well, that rule assumes two things:

1. That you're investing for the long term (i.e. retirement), and more importantly,

2. That you're investing in the stock market, which has a very long track record of going up more than it goes down, such that it always goes up over the long term.

That second one, in particular, is much more of an open question when it comes to BTC.


Thank you, this is a great insight.

> A better rule, however, is: do not try to time the market. Just invest when you can.

I'm not sure if I understood this one correctly. Is it like, instead of trying to find the best time to invest, like waiting for something huge to happen, just invest every now and then when you are able to do it. Is that it?


That's right. If you have $100 sitting in your chequeing account to invest, better to invest it now.

Most people get paid biweekly or twice per month, so it would make sense to just invest when you get paid.


Which means, taking say $100 out of each paycheck and investing all of it on that day. You're not timing the market then, the money wasn't available prior to that. You're not paying attention to the price, you're just getting the price on that day.

This is what dollar cost averaging usually means... assuming prior money was already invested.

But when you have a lump sum, instead of putting it all in on that exact day you can DCA over a short period of time, like 2-5 days or 3 weeks. This is basically averaging over that period which is better than the chance of just happening to pick the wrong day to buy.


Yeah I prefer my way: Invest mostly in things that you would double your investment if they halved in price but that you think that that outcome is unlikely. That way if it halves in price, you get 3x the quantity, but you don't really miss out on a short term bull run because you're in for a significant amount.


You're somewhat missing something. Take the Exchange Gemini: I send USD to Gemini and then I purchase BTC on Gemini and am charged a 0.25% fee on my purchase. So far I haven't paid any transaction mining fees and it's because Gemini isn't actually settling these transactions on the blockhain.

Now, if I were to move these coins off Gemini, then I would pay the mining fee of $2. However, I could just wait 5 weeks and only pay that once, since the fee doesn't scale with the transaction amount.


Leaving the coins on the exchange for that long requires an exchange-hack-or-failure cost averaging analysis to balance things out.


Fair, but I doubt the probability of the exchange getting hacked in 5 weeks is meaningful. I agree that you should never leave your coins long term on any exchange, just to be clear, but there is a reasonable amount of risk you can take.


> I doubt the probability of the exchange getting hacked in 5 weeks

Depending on the exchange that probability could easily be >> 0.0.

Exchanges being hacked or absconding with the coins are all too common, ignoring that possibility is not a recipe for a happy ending.


If you create liquidity on GDAX (any maybe Gemini too) you don't pay a transaction fee. (Though you still pay mining fees.)


I think you're referring to the blockchain transaction costs, and thus assuming each daily purchase of bitcoin is transferred on the blockchain. Another approach would be to accumulate bitcoin in an exchange account (off-blockchain), and withdraw the balance to your bitcoin wallet (i.e. on-blockchain transaction), on a less frequent basis, perhaps monthly. That would mean more like ~$990 invested.


the fees depends on the exchange. In this case are 0.26%. Even if you dont use Dollar Cost Avg you loose those fees anyway


You're right. All these investing "strategies" ignore these costs.


> The investor purchases more shares when prices are low and fewer shares when prices are high.

If you never sell you never lose.


"Rule No.1: Never lose money. Rule No.2: Never forget rule No.1." - Warren Buffett


Would that were true. There are any number of companies that get close to zero (Theranos) and others that do go out of business (see 2008 - Lehman, Washington Mutual, etc.)


If you didn't sell on mtgox you lost everything.


I bought 4 BTC on Mt.Gox when they were ~$25 each. Naturally, after I bought it crashed to the ~$1 territory. Thought to myself "Figures..." and decided might as well hold. Cut to a year (or two?) later and the prices hit the ~$30 territory. I decide to sell and reap a nice little ~$20 profit. Lucky me, eh?


Tangential to the current discussion but you didn't have to cash out, you just had to transfer the coins to your own wallet. I think that was the only reasonable choice -- IMO it really seemed at the time that storing coins with mtgox was not a trustworthy option.


Well, I recommend buying everything at the moment you decide you want to buy, no matter the price.

Anything different than that is likely to give you headaches.


It requires some maths (and some faith in the Black-Scholes model, but it works okay in historical simulations), but you can do this instead. To lock in a price for some stock or foreign currency for a given delivery date:

- Buy an European call and write an European put at this value. This neutralizes your exposure to fluctuations in price; OR - Helpfully calculate that the "delta" for delta-hedging this portfolio is 1/[present stock price] and replicate the put/call combo: when the market goes up 1%, you buy 1/S stock; when it goes down 1%, you sell 1/S stock.

To see why, look at https://en.wikipedia.org/wiki/Greeks_(finance)

Otherwise: try it with a spreadsheet program.


Ok, but where are you going to trade those derivatives?


There is plenty of empirical evidence showing that DCA doesn't work, and only provide a psychological value. Why are people still using it? And for Bitcoin?


It says "Claude Shannon" on the tin.

The amount of Claude Shannon worship in YC is astounding. Shannon basically lied (possibly to himself too) about AI for about 15 years from 1950 on.


Even after reading through Shannon's Wikipedia article, and searching it for "artificial intelligence" and "1950" I have no idea what you're talking about.

It appears as if Shannon created a maze-solving robot mouse with memory, and also published the basic idea for computer chess around that time. Both ideas seem fundamentally sound.

And even if he had somehow been wrong on something at that stage in his life, he had basically created the science of communication single-handedly long before. Plus some minor work in cryptography.


Sources?


https://www.google.com/search?q=dollar+cost+averaging+empiri...

Dollar cost averaging doesn't work because it makes an assumption that doesn't hold in the real world. It assumes that stocks trade in a range, and revert to a "true" price over time. If there were a true price, then you would in fact buy more when the price was low and less when it was high and DCA would work.

But stock prices look more like a random walk, and they display no tendency to revert to a mean.

Here's an article I just found: http://www.crossingwallstreet.com/archives/2010/11/dollar-co...


Besides all the actual sources that others provided, there's always the "proof by capitalism": if DCA made sense, institutional investors would use it and make more money.

They don't use it.


The book A Random Walk Down Wall Street


FWIW, this is a feature on coinbase-- you can just have them ACH charge your bank account a fixed amount each day, each week, each month, etc (each hour maybe?).

Unfortunately the better deal is moving that money to GDAX and buying there... which is a bit hard to do at $11 a day.


Trading != investing, dollar cost average is an investing strategy, not a trading strategy; you have an investing bot, not a trading bot.


No, they have neither. This is just a script to purchase an amount of bitcoin. It has to be run manually for each purchase. It is easier I think to just login to the exchange every day and make the purchase. Not sure why this is so high on HN.


Pieter Levels wrote pretty much the same thing a few days ago, but most people that know about Pieter know he likes to automate things. I'm pretty sure he set his up as a cron job.

https://gist.github.com/levelsio/ee9539134035492ba77a7be1b49...


yes you should add a cron to automate it daily


How do you automate money transfers?


Simple. Just add your bank account details to your exchange account and then your exchange can draw money from there automatically.


Sorry, I live in a country where that is unthinkable.


Buying on coinbase doesn't leverage the Dollar Cost strategy?


can't you set recurring purchases at set intervals on coinbase?


Yes, Coinbase supports daily / weekly / every 2 weeks / monthly recurring buys. They have fees on every buy though.


thanks for letting me know the difference. I updated the repo :)


A better approach with an extremely volatile asset like Bitcoin is a simple tactical asset allocation strategy.

For example, the following system significantly outperforms both buy-and-hold and dollar-cost averaging strategies.

    1. Buy when the monthly price of Bitcoin is greater than its 10-month simple moving average (SMA).
    2. Sell (and move to cash) when the monthly price is less than its 10-month SMA.
That's it. Market timing improves the risk-adjusted returns with minimally increased transaction costs versus a buy-and-hold strategy.


Am I reading this right? It seems to be advocating “Buy high, sell low”.


This is exactly how I read it. I think the OP flipped the two.. This, and the fact there is zero evidence to back up the claim is enough for us to confidently ignore it and move on.


No, the OP said it correctly, it's a momentum strategy, you presume the market will keep going in the direction it's already going. This is a simple trend trading strategy. It doesn't actually work anymore, but anything that ever worked once will continue to live and be promoted by people who don't grasp that markets aren't static.

What the strategy ignores is that it gets eaten alive in ranges, when the market isn't trending, this strategy buys high and sells low over and over until you're broke. Works great when the market is trending though.

Bitcoin for example last crossed its 10 month moving average around $246, it's now trading over 4k; $246 would have been a hell of a price to get in at. So yes, buying the "high" works well in a trending market. It's have to drop to $1827 to trigger that same sell signal so you'd lose well over half the floating profit, and then it'd probably cross back and forth a few times when it's near the average trigger many failed entries and exits eating up all the profit you just made.

Moving average strategies don't work except in hindsight when you can see the trend and decide which MA would have worked (something you can't know beforehand), but they're great teaching aids in understanding and learning about trading strategies because they're nearly as simple as a strategy can get.


Well, think about it in the context of a rising volatile asset. I think what OP is recommending is to identify "entry points" and "exit points".

  - Buy as the asset is rising above 10 month MA (and likely will continue to rise, maybe for weeks, months, years)

  - Sell as the asset is cooling off (falling below 10 month MA). Don't get "back in" until the asset is heating back up.
With something like bitcoin, this idea would be to ride up a large market bull, but then get out until it looks like it is happening again. If you play with the Moving Average[0], you can see that this strategy would basically have you enter in late 2013, sell in mid 2014, and not enter again until late 2015, then hold all the way. Not exactly a riveting strategy, but OP didn't claim as much.

[0] https://bitcoincharts.com/charts/bitstampUSD#rg1460zigDailyz...


Since most markets trend for long periods of time, this winds up being a better strategy than you might imagine. "Buy high, sell low" also isn't quite an accurate description, because moving average crosses in strongly trending markets happen at the beginning of the move, rather than the end.

No one regrets buying AAPL high in 2010, or selling LEH low in early 2008.


>No one regrets buying AAPL high in 2010, or selling LEH low in early 2008.

This is clearly survivorship bias.


I just tried that momentum theory on the bitcoin closing data someone posted in a sibling comment.

I get 715 days of a trend continuing (down->down or up->up), and 739 days of the "trend" reversing: down->up OR up->down.

That pretty much points at a random walk. "Momentum", and any other patterns people see, are imagined.


Standard momentum strategy, sure, but there's no way you can claim this outperforms buy-and-hold for certain.


That makes no sense... It sounds like it directly contradicts the notion of "buy low, sell high"?


And now imagine it with the ability to write covered puts. The juicy premiums are going to be HUGE when you don't get exercised because everyone thinks bitcoin is going to be volatile, and then the one times when your options get exercised you get a lower cost basis!

I want this so bad.

Bitcoin spot market is going to get SPAN margining instead of Reg-T, so the options leverage is going to be amazing, way better than the ridiculous margin requirements for equity options, it is almost unfathomable.

With the CFTC loving it, CBOE and CME Group gearing up for futures and options, and the Winklevoss Twins pushing them hard because they want that ETF, thats how I know bitcoin is just getting started.

This is one of my bullish cases. The entire "but muh volatility" argument goes completely out of the window, after they reinvent hedging.


By "monthly average" you mean "trailing 30 day simple moving average price" and by 10 month you mean "trailing 300 day simple moving average" right?

In this case ,this is assuming that when the market shifts from bull to bear you can see it with a 30 day average-- or put another way, it's assuming it moves at a certain speed.

When you claim that this "significantly outperforms" is that based on measurements of bitcoin or of some other assets?


> By "monthly average" you mean "trailing 30 day simple moving average price" and by 10 month you mean "trailing 300 day simple moving average" right?

No. The system is only updated once a month, e.g., on the first day of the month. Daily price fluctuations are totally ignored.


Author of "possibly the most misguided comment ever read on HN." ?


>Market timing improves the risk-adjusted returns

Unless you've got a crystal ball, market timing isn't something you can count on for investment returns.


10 months could be about 9 months and 30 days too long of a timeframe. Volatile assets are volatile, and 10 months is a long time.


Are you sure? Would you bet your money on that?

If yes, then I must say that black swans are just around the corner waiting for you.


I think this strategy would be safe to black swans because it would be invested when it's going up tremendously, and out of the market when it drops tremendously.

But it would lose all it's value if it just swings up and down slightly over time, as it buys high and sells low.


The whole point of black swans is that you can't predict them. They are equally likely to happen when the market (or a particular security) is going up or when it's going down. I don't see any reason to think you'd be more likely to be out of the market when something unpredictable happens.


thanks! It sounds a good use-case for the next experiment


The downside of this is called "whipsaw".


what about taxes from selling?


Aren't taxes only applicable to the profits? I assume the only issue with taxes is it'd be a little more paperwork to document all the trades done with the bot than just a single buy-then-sell.


> Aren't taxes only applicable to the profits?

If you hold for less than a year it's income, if you hold for more than a year it's capital gains. So buy and hold would possibly be advantageous in the US at least (35% vs 15% tax rates.)


>If you hold for less than a year it's income

But it's the profits specifically that are taxed as income, not the whole sale value, right? If I buy and sell one Bitcoin a hundred times in a day and make $1 of profit in total, is the tax is a percentage of $1 or a percentage of 100 times the bitcoin price?


Yes, just the amount gained. You also can write off losses against any other incomes you have.


Nonsense snake oil.


"Bitcoin investing" sounds a bit like an oxymoron to me (more like speculating).

Anyway, dollar-cost-averaging looks like a great strategy if you are very bullish on a asset which also happens to be quite volatile.


I am sorry to say that but this script is quite laughably naive. It even includes storing your exchange API keys on plain-text on disk. Yum!


When I saw this initially, I thought this'd be a bunch of graphs detailing how you would have done to invest using DCA at different times in the past, and at different amounts.

I'd be interested in seeing that as well.


Is it true that the vast majority of all Bitcoin mining happens near hydro plants in China? If so, regardless of anything else, doesn't that expose Bitcoin users to significant state actor risk?


The only state action that poses a huge risk is if Chinese miners totally have >50% of the hashrate and the Chinese government took control of the miners to mess with transactions. Other than that the worst risk is them shutting down all the miners which would mainly just slow down transaction clearance which would drop the price but not catastrophically.


Nope, actually the most significant risk to Bitcoin specifically from the Chinese government would be an effective block of all Bitcoin-related traffic between China and the rest of the world. This would lead to about 50% of mining power being in China and about 50% being outside of China, both "networks" happily continuing to mine blocks (albeit a lot slower) without knowing about each other, thus confirming entirely different transactions. The market would effectively be crushed by such an event, since the whole point of the blockchain is to have a stable, worldwide consensus about the ownership of every single Bitcoin, which isn't the case anymore if there are two independent networks which both claim to be the "real Bitcoin" (important to note that this is entirely different to the situation between BCH and BTC, where the forked BCH chain is clearly considered to be a "different" chain from BTC by all relevant market actors and also by the software due to different rules for block validation).

If the resulting havoc doesn't let Bitcoin prices fall to zero, the chaos produced by the inevitable blockchain reorganization after the government lifts the traffic block would definitely kill it. Depending on which chain was lucky enough to get more blocks, one or the other suddenly becomes irrelevant, and thus all transactions approved within it are purged from history. If the traffic block is timed intelligently, people and/or organizations that rely on the immutability of the chain have already performed actions as a result of Bitcoin transfers, such as crediting user accounts on an exchange, which effectively enables double-spending of these coins on a large scale. This could only be prevented by immediate ceasing of all Bitcoin-related action in case of such a "net split" event, which isn't easy to do and which in itself is a huge market disruption.

I consider the likelihood of such an event to be rather small, as I assume the Chinese government to have a vested interest in Bitcoin (indeed I assume that certain parts of it have been active participants in the game of cryptos for quite a while, and even without this, there are the proven interests of the Chinese mining economy, whose participants hold large sums of coins and physical values tied to their mining operations). But nevertheless this is a possible threat with much worse consequences than simply having a little bit slower block times.


If this were to happen, wouldn't one or both of the newly isolated mining collectives very quickly hard fork making the situation near-identical to the recent BCH fork?


If it's a true 100% partition between the two chains, ie all transaction sources are disjoint (or potentially have enough coin to cover all transactions that exist on both chains) couldn't anyone that's taken actions based on transactions on the losing chain resubmit transactions to the winning chain and they'd eventually get picked up?

(I've not dug into the protocol at a super deep level so I'm not 100% on what protections are in place that might stop this from working given a properly signed transaction.)


Your link to Electrum is giving a 404. Thought you should know.


thanks fixed


Just buy Bitcoin Today and hold it for a year. Then hold it for another year. Buy it with money that you don't ever need again. Don't do so much that you feel like you woud be in trouble if you lost it all and don't do it with so little that doubling that money in a year would not be worth the rollercoaster that is bitcoin ownership.

The week after I bought mine, it dropped nearly 30% and now it's up nearly 90%. There was a series of emotions because I probably bought enough to be very very engaged but not enough to be in big trouble if it went south.


Yeah that's a good sign that Bitcoin is not an investment its a lottery ticket, or more realistically an entry in a pyramid scheme.


Bitcoin is the first technological form of money. This means it is going thru the normal technology adoption cycle like a high tech startup does, yet its' a form of money. It's a new thing.

Every time the user base expands a bit as more people become aware of it, then the price goes up.

At the same time, every 4 years the rate of emission is being cut in half... so, more people want bitcoins but there are less new bitcoins being made.

That's not a pyramid scheme but it's also not going to produce a perfect %0.2 appreciation per day type schedule.

It is an investment. With a lottery ticket your odds of winning are very small and you will likely lose almost all the money. With a pyramid scheme, the early entrants are paid with money from the later entrants as part of a scam-- and it's unsustainable-- but bitcoin is perfectly sustainable, it's simply an asset that happens to be appreciating.

What is it when you buy an asset whose demand is going up and you think it's going to appreciate?

Investing.

At worst you could call it "speculating" but speculation is just a word for "high risk investments" and risk is in the eye of the beholder.


>It is an investment. With a lottery ticket your odds of winning are very small and you will likely lose almost all the money. With a pyramid scheme, the early entrants are paid with money from the later entrants as part of a scam-- and it's unsustainable-- but bitcoin is perfectly sustainable, it's simply an asset that happens to be appreciating.

I think its pretty clear that the early entrants are getting paid with money from the later entrants. The question left is is BTC sustainable. Etherium shows BTC is easily replaced. Currently yes it is an asset that happens to be appreciating - do you think anyone wants to own it when it starts going down?


How is Bitcoin a pyramid scheme as opposed to USD?


Is that a joke? Show me the USD swinging as wildly as Bitcoin does in any time frame. There's a reason it's the standard across the world.


I don't believe there is any conceptual correlation between X being a pyramid scheme and the price of X fluctuating wildly. "Pyramid scheme" is an actual term with a fairly widely-understood meaning. It doesn't just mean "any thing I don't like."


A very small minority of people control the vast majority of Bitcoin, it goes from thousands to hundreds over a course of months. All from manipulation by that small minority.


There's also a small minority of people that control the vast majority of USD.

A pyramid scheme is a business model that recruits members via a promise of payments or services for enrolling others into the scheme, rather than supplying investments or sale of products or services.

Bitcoin has no such thing.


Except the price of the USD isn't manipulated to such an extreme, only to encourage others to join in so they can be cashed out.


It represents a massive massive redistribution of wealth rather than a pyramid scheme. Not an even distribution, but a different distribution for sure.


There are many currencies that do swing as wildly as bitcoin and we do not refer to those as pryamid schemes.


Can you elaborate on why you think Bitcoin is a 'pyramid scheme'?


a few years back I made a similar DCA website, you can find it at: https://coinsavers.net

The site has helped me to take the timing anxiety out of buying; it was initially made as a SAAS, but I've abandoned that idea. Please don't sign up with too many ;)


DCA is just the way of periodically buying some bitcoin at the fixed dollar amount.


I follow this manually. Buy 100$ worth top 30 crypto every week on bittrex.


Manually? So every week you do 30 separate trades on Bittrex? Seems like a lot of work and also you have 30 transaction fees (including the spread cost) for only $100.

I like this idea, but only if it's scripted and for more than $100 per run.


Transaction fees (including the spread cost) on cryptocurrency exchanges are typically a percentage rather than a fixed amount. So it doesn't matter if you do $100 every week or $400 every four weeks.


Yes, you're correct -- my mistake. Bittrex's fees are 0.25% of each trade.

My point about doing 30 trades every week manually is a lot still stands though. Maybe I'll try scripting this with Bittrex's API. It would be cool to have an option to scale each trade size by the current relative market cap, so you can have your own crypto index fund.


That's exactly what I did. I'm doing it on poloniex, but I'm pretty sure you could do the same for bittrex too. However, they are a bit limiting on the kind of orders you can make (I believe it's limit orders only). Poloniex has fill or kill orders, which makes some things easier to handle.

https://github.com/charlespwd/crypto-trader


.15% I think it is? Or is that a different fee class


i am ok with diversification, but 30 is way too much i think. I prefer leveraging the investment on less cryptos putting more in less of those





Guidelines | FAQ | Support | API | Security | Lists | Bookmarklet | DMCA | Apply to YC | Contact

Search: