Can 1 Bitcoin Pay Me ₹1 Lakh Per Month Forever?
An experiment to test out my conviction in Bitcoin
This is a thought experiment. It's not a real experiment. However, based on my conviction of Bitcoin and how the global monetary system works, I am making a prediction.
My prediction is that if you buy 1 Bitcoin today, and wait for 3 months, from January of 2025, you can liquidate small portions of your Bitcoin to withdraw ₹1 lakh per month forever.
Today, the cost of Bitcoin is ₹54,55,000 (₹54.5 Lakhs). So let’s assume that we are buying 1 Bitcoin today.
Now there is a chance that we will run out if the Bitcoin price doesn’t appreciate that much, that fast. We might last for 3 years, 5 years, 10 years forever. Only time will tell. So let’s play this game.
Today's Price of Bitcoin: $60,500 (In US Dollars). This is ₹54.55 Lakhs. In India, BTC sells at a premium. 1 USD is 90, not 85. This is across all the exchanges.
The first withdrawal of ₹1 Lakh: Jan 1st, 2025 (If Bitcoin price stays at ₹54.55 Lakhs, we would have to liquidate 1.8% of our holdings and we will be left with 0.982 Bitcoin (or 98,200,000 sats. 1 Bitcoin is 100 Million Sats).
If the Bitcoin price stays the same, and if we withdraw 1.8% every month, we will last only 55 months. That’s 4.5 years. If Bitcoin price doubles, we will last 9 years. If Bitcoin price crashes to half of what it is, we will last a little bit more than 2 years.
We will not be calculating the taxes owned on the sale of Bitcoin for simplicity of math.
Remember, I am not buying Bitcoin in real and liquidating it. This is a thought experiment. I am managing my living expenses through my business cash flow and income and not touching my Bitcoin.
However, if someone wants to retire, I think Bitcoin is a great asset class. It might be too early to say if my “passive income” strategy of selling small portions of Bitcoin will work. And that’s what we will find out in this experiment.
Will we be able to last forever? What do you think? If not how long do you think we will last?