Operation Saylor - Episode 13/120

Hi again and welcome to another episode of the Operation Saylor. This is update number 13, corresponding to July 2023.

If you are reading this for first time, you might want to check Episode 1, where my plan and details are explained. That will get you in context.

This month we hit the 1st anniversary of Operation Saylor! We have successfully gone through 10% of the loan payback period, life is good and we haven't lost any limbs along the way.

Time flies. Roughly one year ago, I was staring at the red tape for the bank loan. The idea of taking a loan to buy Bitcoin had been spinning around my brain for many months before that. After a long time of thinking at the same time that it was madness and also that it was obviously the right move, I found myself in a moment of clarity and I pulled the trigger. It was a purely online transaction: I just had to login into my bank's webpage, click click click, and the 33,000€ appeared in my checking account instantly. Seeing how a bank makes money out of nothing so easily, without any human at the wheel, was a weird experience. A small sshow of the fiat crazyness, if you will.And then, I quickly got my hands dirty and started making the first purchases for the DCA-in plan.

I thought I could use this anniversary to make a small assessment on how the operation is going. Which drives me to take a step back and consider: how should success be measured? What are the criteria? Where is the bar? I think there are several ways to look at this, from simpler to more sophisticated.

The first that comes to mind is: I still have the BTC and haven't fucked up with self-custody. I shit you not, I'm much more scared about making a mistake on storing the corn than I am about the volatility and price risks of Operation Saylor. On this area, success is complete since I haven't lost a single sat.

Another simple way to look at it is the fact that I have been able to stick to the original plan completely. No unforeseen circumstances, crazy price variations or stupid decision-making from my side have taken place. I have followed the course of action that I originally drafted to the letter, and there is nothing in the horizon that makes me think that this won't be the case for the next year as well. I think this is important, since many times our plans don't fail because they are flawed, but because we sabotage them ourselves. So, by this measure, Operation Saylor is also on the path to success.

Jumping a little bit into numbers, there is a question that can be asked any time during the entire span of Operation Saylor: where would we stand if we paid back the loan completely today? This is real option that I always have, since my bank is willing to take early pay offs, up to the complete pending amount of the loan, at any time. This comes with a 1% penalty on top of the paid off amount.

My current pending debt with the bank is of 30,514.82 €. This is different from the 'Outstanding debt' that I usually show in the stats section and the charts because there, for simplicity's sake, I include all the interests that I will face if I stick to the original 10 years payments plan. So, 1% fee of 30,514.82 € is 305.15€, which adds up to a total of 30,819.97 €. Given that the current value of the stack is 38,005.80€, that means if I was to sell the corn and pay everything back, I would walk away with 7185.83 €. The chart below shows this. The horizontal red line represents the cost of paying back all the loan today.

7K is not a life changing sum by any means, but it's a nice sum to get in exchange for 0 effort and 0 starting capital. It's also just nice because being in the green provides peace of mind in the sense that, if shit hits the fan right now for any reason in my personal life, Operation Saylor wouldn't be a net negative. Overall, I think this can also be considered a success, at least so far. Also, just to make things clear, I have no intent of paying back the loan early. Playing long-term is a key factor for the success of Operation Saylor, and I have no intent of timing any kind of early exit. So, unless misfortune strikes, we have 9 years ahead of us.

A final way to assess Operation Saylor is by analyzing the bitcoin cashflows together with the price. In the chart below you can see the usual line chart with the evolution of the bitcoin stack, combined with a secondary line and axis showing the evolution of Bitcoin's EUR price.

This is truly a story of good luck so far. You can see how I DCA'd into a falling price during the first six months, which means it was a much better choice than to simply lump sum the loan principal immediately. This led to an average entry price of 20,420€/BTC. Afterwards, I spent three months without selling any corn, while the price of bitcoin ramped up from around ~15K to around ~25K. By the time I had to sell a bit of corn for the first time, the price was clearly above my entry price, and has remained hovering over there so far.

While this picture provides quite a sweet feeling, this isn't really defining the success of Operation Saylor. It's simply a good start, that could be followed by a terrible continuation or by more good luck. Only time will tell. Nevertheless, I can't deny that DCAing right into the bottom of the bear market is quite a badge I'm proud of. In any case, if Bitcoin does what we all more or less agree it should do in the following 9 years, these small details of the first year will probably disappear into oblivion unless we use a log chart. Which is exactly why playing long-term is key for success here.

I'm going to leave it here. In some upcoming episode, I might compare the performance so far against some hypothetical scenarios that I built before I started Operation Saylor, which I think could also be an interesting way to measure its success. But just with the simple judgments that I made above, I'm going to personally conclude that Operation Saylor has been a success so far. No mishaps, the plan still holds together, timing seems to have been great and we are in the green. What else can one ask for? I'm grateful things are the way they are and look forward to whatever may come.

Thanks for reading my thoughts during this year, and I'll see you around next month.