In the last months of 2023 high transaction fees have made saving small amounts of bitcoin in self-custody a daunting task. But there is a strategy to navigate these waters. In this blog post, I'll give you my recommendations on how to effectively save bitcoin despite high transaction fees. I'll explain how to start with a (self-custody) Lightning wallet, swap your funds for long-term storage or use the funds to open channels to optimize your savings.
You can't afford to acquire at least 600,000 satoshis in one step then start with a Lightning or Liquid Wallet: Lightning is designed for micropayments and Liquid is a sidechain of Bitcoin both help you to save on fees. Even custodial wallets are an option for a start, but don't forget self-custodial wallets offer control over your funds.
Aim to save 300,000 in your Lightning or Liquid wallet and then:
Swap for Long-Term Storage or Open a Channel: Once you've reached your target amount, you can either:
If you've used the Phoenix wallet to open a channel, be mindful not to send satoshis directly to an on-chain address from your wallet, as it reduces your channel's liquidity. Instead, use services like boltz.exchange for efficient swaps that don't affect your channel's capacity.
By starting with the right type of wallet, accumulating a strategic amount of bitcoin, and making smart choices about when to swap or open channels, you can effectively save and grow your bitcoin savings despite the challenge of high fees. This approach ensures that even small-scale savers can participate in the Bitcoin network economically.
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Based on: Learn Bitcoin, Wallets, Lightning Network, Liquid
The Bitcoin Whitepaper as published by Satoshi Nakamoto on Oct 30, 2008
My guest is Adam Back, inventor of Hashcash, cited in the Bitcoin whitepaper, and CEO of Blockstream, discussing his contributions to cryptography and building future internet infrastructure.
My guest is Andreas M. Antonopoulos, addressing common misconceptions and FUD surrounding Bitcoin, including volatility, energy consumption, wealth distribution, and risk of failure.
Subscribe to my weekly newsletter: The Orange Journal
Join my Bitcoin learning platform Crack The Orange and I'll give you all the tools and knowledge you need to use Bitcoin in a secure way.
Read my book (L)EARN BITCOIN