You may have heard the phrase “stacking sats” used online in the context of bitcoin, or maybe you read it here on the blog. This is a popular meme in the bitcoin community, and you’ll often hear it stated as stay humble and stack sats.
The person who invented this catchy phrase is the bitcoin podcaster and privacy advocate Matt Odell, but it’s widely used throughout the community. It’s even made it’s way to mainstream financial news a few times, and will probably develop into one of the longest running axioms in Bitcoin Land, perhaps only second to not your keys, not your coins.
What exactly does stacking sats mean though?
At a high level, stacking sats means to continually buy bitcoin over time. “Sats”, is short for “satoshi”, which is the name for the smallest unit of bitcoin. A whole bitcoin contains 100,000,000 satoshis, so ₿0.00001 is equal to 丰1000. This is the same concept of dollars and cents, like $0.10 is ¢10.
The reason you stack sats instead of stack bitcoin is that the price of bitcoin is so high right now! Most people can’t afford a whole bitcoin, let alone buying multiple bitcoin at one time. Considering that a sat is still worth just a fraction of a penny, everyone can afford some sats. You can buy more than 2,000 sats with a single dollar!
There’s more to the philosophy of stacking sats than just the mechanical explanation though, so let’s dig deeper into what it means to stack sats.
5 Basic Rules For Stacking Sats
1. Consistent Buying Regardless of Price
The first rule of stacking sats is that you don’t time the market. Buy low. Buy high. It doesn’t matter. Nobody knows which way the price of bitcoin could go next. You might buy at $40 and it rockets to $200k in the next six months. Or it could drop 50% next week.
When your target price for bitcoin is over a million dollars, it doesn’t matter if you stack at $100, $1,000, $10,000, and beyond because it all comes out in the wash. Stack what you can, when you can.
If you are always waiting for a dip, you might be waiting forever.
The second rule of stacking sats is to stack no matter what. Consistency is key. Because you’re ignoring the price for your recurring buys, it should be easier. It doesn’t matter what’s happening in the world, you just keep buying no matter what. The strategy is no strategy.
That may seem counterintuitive – shouldn’t you buy when the market is low? Shouldn’t you wait for a good time to buy bitcoin? Sure… if you have a crystal ball and can predict what’s going to happen.
The trouble is, there’s a constant stream of bullshit in the mainstream media, alongside a constant stream of engagement farming hopium pushed out by bitcoin influencers. You can choose to believe what you want, but nobody knows for sure until it all plays out, and then it’s too late.
That’s why you stack sats regardless of price, and regardless of what’s in the news. As long as you have a sustainable stacking plan in place, then it shouldn’t matter.
2. Don’t Become A Forced Seller
Stacking sats means you’re continually adding to your stack of bitcoin. Friends don’t let friends sell bitcoin! LOL OK that’s just a meme. Bitcoin is money and you can do whatever you want with it. If you want to cash out some bitcoin, that’s cool, but just don’t become a forced seller.
Becoming a forced seller means that you don’t want to sell your bitcoin, but you have to.
One way to become a forced seller is to use leverage to buy bitcoin. Leverage can come in the form of trading or borrowing. They are essentially the same concept, but presented in different ways.
Leveraged trading is generally offered by bitcoin exchanges, where you can take a long or short position in bitcoin, basically betting with other users which way the price of bitcoin will go. It’s a way to “super charge” your bitcoin gains, because if bitcoin goes up and you’re long, you get more bitcoin. If bitcoin goes down, and you’re short, you get more bitcoin.
The issue is that this is essentially gambling, because nobody can predict the future. People can draw charts or make predictions all day long, but nobody knows for sure. If you guess wrong, you can get rekt, and lose your all bitcoin.
Borrowing against your bitcoin to buy more bitcoin is another way to get liquidated in the market. There are many popular services that do this. You deposit some bitcoin, take out a loan backed by the value of that bitcoin, then use that loan to buy more bitcoin. If bitcoin goes up in price, you pay back the loan, and you end up with more bitcoin than before. Simple, right?
The problem is when bitcoin goes down.
The loans you take with these services require that you maintain a specific LTV (loan to value) ratio, meaning if the price of bitcoin (the value backing the loan) goes down, you have to add more bitcoin to maintain that ratio. If you don’t have more bitcoin, or don’t top up fast enough, they liquidate your position to pay back the loan. Bye bye bitcoin!
Outside of leverage, you can also become a forced seller of bitcoin if you simply overextend yourself by purchasing too much bitcoin and not giving yourself enough fiat savings to pay for emergencies. This has happened to me. I had some renters move out unexpectedly, and had to sell some bitcoin to pay for new paint on the property.
It wasn’t much, and I sold at a profit, but now I have to pay taxes on that profit! If you sold at a loss, you could take the loss on your taxes, but you still have less bitcoin than before, and the goal of stacking sats is to get more bitcoin!
There are conflicting opinions on this idea of “forced selling”. Some people say who cares and you should keep all your money in bitcoin at all times, and just sell when you need it. These are the folks saying to #getonzero, as in “own zero fiat currency” and only use it for exchanging when necessary. Others, including myself, prefer to have a fiat emergency fund and fiat for day-to-day life, while keeping my long term savings in bitcoin. Life is simpler this way, in my opinion.
Hope for the best, but prepare for the worst! With trading leverage and bitcoin lending, it’s no fun to be a forced seller. It may be the bottom of a bear market, and those sats you sold could be worth 10x in a year. When the bull market takes hold, things move fast, and it’s hard to get into a good position with the price doubling every couple of weeks.
3. Stack Into Cold Storage
One of the main benefits of bitcoin is that it’s permissionless money, but to take advantage of that permissionless quality, you need to hold the keys to your bitcoin. If your bitcoin is on an exchange, they hold the keys, and ultimately, they have control of your bitcoin.
They can tell you how much you can use, when you can use it, who you can send it to, and what you can buy. If you hold your bitcoin on an exchange, you don’t own bitcoin. You have permission to access a bitcoin IOU.
Not your keys, not your coins
Bitcoin Axiom
Stacking sats into cold storage is pretty simple:
- Buy a reputable hardware wallet.
- Write down your seed phrase
- Secure your seed phrase
- Withdraw your bitcoin to the wallet address
Like driving a car, you don’t have to understand absolutely everything in the world about it, and you can still get the benefits of it. Practice a few times before sending your entire stack, but a top goal of yours as a humble sat stacker should be getting your bitcoin off exchanges and into your possession.
There WILL be a time when you are worried about having your bitcoin on an exchange, and when you realize you have full control of it, you will breathe a sigh of relief. There are exchange hacks. There are withdrawal limits. There are sudden account closures. There are a number of things that can go wrong with exchanges, and you avoid all of them by keeping your bitcoin in cold storage.
Of course, there are downsides to cold storage, so it helps to get educated on proper bitcoin security practices
4. Bitcoin Is Your Unit of Account
At the heart of bitcoin is an unstoppable savings technology. Bitcoin is money that can’t be debased or confiscated. As you begin to truly understand what makes bitcoin such a powerful technology, your mindset will change from “how much is my bitcoin worth” to “how much bitcoin do I have”.
I came to get rich, but stayed for the revolution
Bitcoin Axiom
You will watch the purchasing of your fiat bank account drop, while the purchasing power of your bitcoin account rise, and start to think to yourself, “Wow, I need more bitcoin!”.
Stacking sats is an accumulation game. The more bitcoin you buy, the more you win. It doesn’t matter how often you stack, how much you stack, or how much you have compared to anyone else. Stack what you can, and if you have more bitcoin at the end of the month, then you win.
It’s no secret that the price of bitcoin is volatile. One month your bitcoin savings account could be worth $10,000, and the next month it may be worth $6,000. The following month it could be $15,000.
My own experience is that because the dollar denominated value of my stack would vary so wildly over time, the dollar value started to lose meaning. Am I rich or am I poor? It was different all the time.
Then, I started to think in bitcoin, and suddenly, my savings stabilized. ₿1 = ₿1, and that doesn’t change. Stacking sats means you’re always watching your bitcoin balance go up, and the fiat value doesn’t matter as much.
5. Stay Humble
Staying humble means that you make a plan and stick to the plan. Remember the leverage, loans, and overbuying I mentioned above. It’s easy to get into a situation where you have to sell bitcoin, get rekt, and lose a good portion of your stack, or even the whole stack.
When you’re humble, it means you think long-term. There’s a bigger picture playing out. Don’t get too depressed in a bear market. Don’t get too euphoric in a bull market. The journey to hyperbitcoinization and global adoption of bitcoin as a monetary unit is going to take a while. Years. Decades. It’s going to be a long journey. If you’re freaking out about day-to-day events, then you’re NGMI (not gonna make it).
Personally, I also think that saying humble in the context of bitcoin means that you just keeping living your life and doing what you’re good at. Don’t just make a big bet on bitcoin and then just sit and wait for the price to pump, because it might not. You’ve got a life to live, and even if bitcoin 1000x’s tomorrow, you still need a plan for how to live your life.
Buying bitcoin isn’t about getting rich and quitting life. Find something you’re good at, then do that. Think about what you want out of life, then work towards that. Use bitcoin to save money and preserve your wealth, but bitcoin isn’t the solution to fixing your life – you are.
What Stacking Sats Means To The Everyday Bitcoin Pleb
In the bitcoin space, a “pleb” is a jokey way to refer to the average, everyday people in bitcoin. We don’t have a lot of money. We don’t get interviewed on TV. We don’t run a crypto hedge fund. We don’t have 12 hours a day to listen to podcasts and read books by Austrian economists. Plebs are just the average bitcoiners living their life, stacking sats, and learning about bitcoin.
When you’re stacking sats, you may look at influencers who own a lot more bitcoin than you and be envious of their position.
I wish I knew about bitcoin sooner
I wish had more money to buy more bitcoin
I’ll never be able to be a stack a whole bitcoin
This is the wrong mindset. Remember the humble part from #5 above? Bitcoin is a part of your life. It’s not your entire life.
If it makes you feel any better, there are only a few million people in the world who know about and actually own bitcoin, so if you buy some bitcoin right now, you’re part of the top 1%. Funny – I’ll bet you never thought you’d be part of the one percent, right? You may laugh now, but it was a big deal when bitcoin hit a price of $1. Personally, as I stack sats for myself, I think about the future where a single sat is worth a whole dollar.
If you can only stack a few thousand sats right now, then do that. Maybe you can stack more later. Maybe you can’t. Wealth is relative. Saving 10% of your paycheck and stacking it into cold storage could mean you have more money than someone riding in a private jet who is millions of dollars in debt. Don’t fall into the comparison game, but I just mean to make the point that everyone’s situation is different.
Do what you know how to do. If you want to do better, read, learn, and change your strategy. Worrying about how much bitcoin other people have isn’t going to make you happier. Keep stacking sats and if you have more bitcoin at the end of the month, then you’re doing it right.
Final Thoughts: Stay Humble & Stack
Memes begin in reality, and they stick with us because they reveal truths. Stay humble and stack sats is one of the most often repeated and closely adhered to axioms in the world of bitcoin not just because it’s a catchy phrase, but because it contains years worth of trial and error among bitcoiners distilled into five words.
Frequently Asked Questions
Where Can I Stack Sats?
You can stack sats anywhere you can buy bitcoin, but the best places to stack sats are the exchanges that allow for automatic buys. Some bitcoin exchanges allow you to set a specific amount pull from your bank account every day, week, or month, while other exchanges allow you to deposit your paycheck and divide a portion to sats and a portion to fiat dollars. You can stack as little as a few hundred sats at a time, though those purchase would likely be made from dollars that already exist on the exchange, not pulled from a bank account (it’s too expensive).
What Does DCA Mean In Bitcoin?
DCA means “dollar cost average” in bitcoin, and it means to spread out your bitcoin purchases over time. Technically, this is a way to distribute a large amount of money into an investment over time as a way to offer yourself downside protection and enter an investment slowly over time. Bitcoiners casually talk about DCA when they add bitcoin to their stack every month.
How Many Sats Are There In A Bitcoin?
There are 100,000 sats in a bitcoin. There will only ever be 2,100,000,000,000,000 satoshis in the bitcoin network (21 million bitcoin’s worth of sats)
Is Satoshi A Cryptocurrency?
Satoshi is not currently a cryptocurrency, and most people who are talking about Satoshis are talking about bitcoin. Satoshis, or sats, are fractional units of bitcoin, or 1/100,000 of a bitcoin. Someone may create a new altcoin named “Satoshi”, or “Satoshi’s Coin” or some derivative of that name in the future, but the only satoshis worth owning are bitcoin.
What Does Stacking Mean In Bitcoin?
“Stacking” simply means that you are accumulating bitcoin over a period of time. Like a stack of coins of any currency or denomination, if you keep adding more coins, you keep having more money. This would be in contrast to trading bitcoin to attempt to time the market with buying and selling as a means to acquire more bitcoin. Stacking is simpler, less stressful, and a more reliable way to ensure that you end up owning more bitcoin every year.
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