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evangelism/episodes/episode_1.md
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# Operation Saylor Episode - 1/120
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Hi there, welcome to Operation Saylor series.
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I have decided to take a loan to invest in Bitcoin. I will make a series of
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monthly updates here to track the evolution of this operation I have dubbed
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Saylor (in honor of [Michael Saylor](https://twitter.com/saylor), whose bold
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bet on Bitcoin and willigness to promote it where strong inspirations for this
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adventure).
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My goal with sharing this experience is to allow everyone to learn whatever can
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be learnt from my plan and
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execution. [Jamespunk great blog on his DCA path](https://er-bybitcoin.com/)
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was and is a great example of how a real life, first person narration can be
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very instructive. I hope this series can fulfill a similar role for this
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different investment approach.
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As this is the first episode, I'll provide some context so that you understand
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better this and future updates.
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## The Operation
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On July 2022, I took a loan with my usual bank. This is an uncollateralized
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loan with a fixed amortization schedule. The numbers:
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- Principal: 33.000€
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- 120 installments in 120 months (10 years)
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- APR: 5.99%, APY: 6.16%
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- Each installment will be of 366.20€
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- Total interesed paid will be 10,944.33€
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- Early amortization penalty of 1%
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- No opening costs
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As this loan has no collateral, there is no margin call or liquidation of any
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sort. The loan is completely orthogonal to whatever the evolution of bitcoin's
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price is.
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During the following six months, my plan is to swap 5.000€/month into bitcoin.
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I do this instead of simply lump-suming everyting to softly minimize the risk
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of picking a terrible entrypoint.
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After these six months, I will have a bitcoin stack of a certain amount and
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around 1.000€. From that point on, the plan is to:
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- Pay the installments each month.
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- Whenever the € stash goes very low, sell a bit of bitcoin back for € to pay
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for the next installment. Goal here is to keep as much value in bitcoin as
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possible and only go back to € tactically to cover the installments.
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- Repeat until 10 years have passed.
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As time passes, two scenarios can take place:
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- In the SHTF (shit hits the fan) scenario, I run out of bitcoin before the 10
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years have passed and I am left with 0 stash and some amount outstanding with
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the bank. I will be forced to keep paying the installments from my personal
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pocket and Operation Saylor will have turned into a net negative for me. This
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could happen both in case a black swan completely destroy bitcoin and its
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value, or simply because bitcoin's € price doesn't go up fast enough to make
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a net return.
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- In the Moon scenario, I manage to pay all the installments by taking small
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bites of my bitcoin stack and I still have some amount of btc left in the
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end. I will have succesfully earned value with my bet, and I am left with a
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nice stack of some unknown value. This would happen in a scenario where
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bitcoin behaves the way it tipically has for the past 10 years (or with a
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slightly watered-down behaviour in terms of return and volatility) and I get
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lucky with the early volatility.
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My hope is that Moon scenario will happen, but I am very well aware that SHTF
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scenario is a serious possibility.
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## Are you crazy stupid? Never borrow money for investing
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I am aware that there is a not negligible probability of losing several
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thousands of euros with this operation.
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But, after carefully judging, I think there is also a significant chance of
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getting a great upside. After playing with different simulations and
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hypothesis, I decided that the expected outcome looked net positive and decided
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to pull the trigger.
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I am also taking a calculated risk. Given my personal finances and life
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circunstances, the SHTF scenario would be a nasty blow but not a death
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sentence. Even if I get hacked on day 1 and lose all the money, I still expect
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to have a plate on the table every day and a roof over my head.
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## Why make it a series
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There are several motivations to doing this.
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- Explaning and documenting my plans helps me reflect on them deeply. It's a
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bit like a peer review, with the only difference I am reviewing my own plans.
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- As discussed before, I find personal, real life stories of bitcoiners and
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their actions fascinating. Macro environment analysis, papers, technical and
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economical books, ... They are all great reads. But I think sometimes we also
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need simple stories from regular people like us, with all the crisp of the
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real life and down to earth practical issues. Bitcoin is, after all, a
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grassroots, bottom-up phenomenon. It is the small actions of you, me and
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everyone else which compose the emergent behaviour of the network.
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- I think that, on most forums and communities, there is a dogmatic rejection
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to any kinf of idea related to borrowing money for investing. I am the first
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to agree that, for most people, most of the time, it is a terrible idea that
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should be avoided. But it is also my belief that under the right
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circumstances, it is a valid strategy. And so I am slightly pissed off
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because this automatic, parrot-like "NeVEr BorRoW tO INvEsT" comments hijack
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any kind of honest debate around this. I hope that these series can be
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counterbalance this and get people discussing in a calm and thoughtful manner
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the possibility of doing something similar to what I am doing. If the angry
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mobs hijack my posts anyway, at least I hope that whoever is curious about
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the outcomes of taking this seemingly crazy and bonkers course of action can
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ignore the deniers and simply read my story.
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## Why not simply DCA with a part of your salary isntead
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I am. This operation happens on top of my already regular DCA schedule. So you
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could say I am doubling down.
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As time passes, comparing Operation Saylor to having DCAd the amount equal to
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the paid installments will be an interesting analysis.
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## So should I do this as well
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The answer that most probably fits your circumstances is no.
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But, depending on your personal finances, risk aversion, other investments and
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what kind of loans and conditions you have access to, there is a chance that
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borrowing to invest might be a suitable option for you.
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I invite you to run your own analysis and put a lot of thinking into this
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decision. During the series, I will share my own train of thought and the
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numbers I ran before pulling the trigger.
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If you reached this far, thanks for reading. I'll be happy to discuss further
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in the comment section.
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---
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## Stats
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- BTC Stack:
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- Current value in €:
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- € in:
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- Paid back to bank:
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- Outstanding debt:
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- Installments to go:
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Charts
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- BTC churn chart
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- Value of stack vs Outstanding debt with the bank
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## Log
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<Explain something interesting here>
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