We are all fiat

The real risk is not spending bitcoin, but holding too much liquidity in fiat currency.

Imagine having half of your savings in bitcoin and the other half deposited in a bank. Which of the two halves will you naturally be incentivized to spend first? The answer is obvious: the one that is depreciating, namely fiat currency. The reasoning seems logical: spending bitcoin would mean giving up potential future gains. However, there is a paradox in this choice. That potential gain is already being lost with all the fiat money you continue to hold. If that 50% of your wealth were also in bitcoin, you would already be fully exposed to all possible upside. At that point, the only real sacrifice would be limited to what you spend on your daily necessities. In other words, every time you choose to spend fiat currency while saving your bitcoins, you are effectively taking a precise market position: you are short on bitcoin and long on fiat.

There is a paradox that lurks in the Bitcoin community, and it particularly affects the so-called “Saylor Bros” – those who have made HODL a religion. While they preach unlimited accumulation and criticize those who dare to spend their satoshis, they find themselves with bank accounts full of euros or dollars that depreciate day after day. The result? Every euro or dollar not converted into bitcoin is betting that Christine Lagarde (ECB) and Jerome Powell (Fed) are more reliable than an immutable mathematical algorithm.

Bitcoin’s price volatility is at multi-year historic lows and shows a long-term downward trend, signaling a deeper and more mature market compared to past cycles, also thanks to greater institutional participation and the liquidity of listed instruments. According to an analysis by Kaiko Research, BTC’s 30-day realized volatility is currently below 40%, lower than the average of 51% since January 2022. Since the launch of spot ETFs, 30-day realized volatility has not exceeded 80% and dropped to 25% in June 2024.

According to a 2024 Fidelity report, through the end of 2023, there were 92 S&P 500 stocks more volatile than bitcoin’s price. For the asset management firm, as the asset matures and its total market capitalization grows, capital inflow is expected to have less impact on price.

Conversely, the U.S. M2 money supply has recorded a structural jump after 2020: from $15 trillion pre-pandemic to over $22 trillion in 2025 according to official Federal Reserve data, with new highs reached during 2025, testifying to the monetary expansion following pandemic quantitative easing.

In parallel, inflation has reached multi-decade peaks: in the Euro area, the HICP (Harmonized Index of Consumer Prices) reached 10.6% in October 2022 before returning toward 2-3% in 2025; similar dynamics were observed in the United States, with a strong inflationary impulse in 2021-2022 and subsequent decline, but with permanently higher price levels.

Faced with these numbers, continuing to maintain a substantial portion of one’s wealth in fiat currency is not prudence, it is a bet. A bet that central banks will manage the money supply better than a mathematical protocol with fixed, immutable, and verifiable issuance.

Michael Saylor has transformed Strategy (formerly MicroStrategy) into a bitcoin investment vehicle, advocating relentless accumulation. A brilliant strategy for a company that has access to capital markets and can issue debt or shares to acquire additional fiat currency to convert into bitcoin. But any private individual does not have these tools. If one truly applied Saylor’s strategy logic to its fullest extent, an individual would end up with 100% of their wealth in bitcoin. And at that point, they would inevitably be forced to spend it to live.

Would that really be a problem? If the goal is to maximize exposure to bitcoin, why should one maintain thousands of euros in a checking account? Every day that passes, that liquidity loses purchasing power. The truth is that if you have enough fiat currency to be able to choose what to spend, then you have too much fiat currency. The correct mantra should not be “keep in bitcoin only what you’re willing to lose,” but its opposite: “Keep in fiat currency only what you can afford to lose.”

The classic objection regarding spending bitcoin has always been: “But do you have to convert bitcoin to euros to pay for goods and services, wasting time and paying fees?” This objection no longer holds today.

Services like Bull Bitcoin have created infrastructures that allow you to spend bitcoin directly without having to convert it manually. The Canadian broker allows you to make euro transfers using your satoshis directly, making it possible to pay suppliers, public entities, companies, and top up debit cards linked to IBANs.

The technological solution exists, it works, and it is available today. The problem is no longer technical, it is mental.

The true pioneers of bitcoin, those who used it when it was worth a few dollars or even when it was worth nothing, spent it. Laszlo Hanyecz bought two pizzas with 10,000 BTC not because he was stupid, but because he believed in a usable monetary system and had wealth far exceeding that amount.

Bitcoin was born as “A Peer-to-Peer Electronic Cash System,” not as “A Digital Asset to HODL Forever While Keeping Your Life Savings in Depreciating Fiat.” If someone’s strategy is to accumulate bitcoin indefinitely without ever using it, they are implicitly declaring that something else (fiat currency) has more monetary utility.

The choice is not between spending everything or spending nothing. The choice is which currency to expose yourself to.

Bull Bitcoin is the world’s longest-running Bitcoin-only exchange. Strictly non-custodial. Try it here.

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