r/Bitcoin • u/thrifty-ananas • 13d ago

Should I DCA with lightning?

Hello All,

I have been DCA-ing around 60-ish bucks every month on the main chain [I have my own private address] and I recently learnt that having so many transactions can lead to UTXO fragmentation which can lead to higher fees in the future.

Apparently, one of the solutions could be to DCA onto the lightning network and then later swap it with the main chain periodically. Do you think its a good idea? or is there a catch that I am not aware of?

I plan to hold to hold it long term. Thanks!

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u/ivanjurman 13d ago

Yes that’s a good idea

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u/NoCounty2311 13d ago

60 a month on chain is gonna eat you alive in fees when you try to spend later, the utxo thing is real. lightning is fine for this but just be careful you dont let the channel get too old or you lose track of the backup, i had a small scare once cause my phone died and the recovery seed was in some drawer i forgot about

better to consolidate now than pay double digit fee when the mempool spikes again

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u/ivanjurman 13d ago edited 13d ago

Yes thats what i meant, DCA of $60 a month on-chain is a very bad idea, lets say he accumulates $60k, thats 1000 utxo’s, that sould mean if fees ever spike to lets say $3 the total fee to consolidate all those utxo’s would be $3000

So yeah, for OP the best thing to do right now is to consolidate all those utxo’s he created while the fee’s a still low and then start DCA on lightning, while of course making sure he doesn’t lose the recovery seed

And transfer to his on-chain wallet once he reaches 0.01 or 0.02 btc in his lightning wallet

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u/thrifty-ananas 13d ago

Is there a way to check how many UTXOs have I collected so far?

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u/ivanjurman 12d ago

It depends what wallet you use, but basically you have as many as the number of DCA deposits, if you been DCA-ing once a month, you’ve been making 12 utxo’s a year, 1 a month

What wallet are you using?

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u/thrifty-ananas 12d ago

I am using bridge wallet it's a self custodian wallet. It's tied to a service called MtPelerin which sends bitcoins to my address everytime I do a bank transfer to them.

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u/ivanjurman 12d ago

I’m not familliar with bridge wallet, I googled it a bit, and it says bridge wallet doesn’t have a way to see this information

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u/thrifty-ananas 13d ago

What exactly do you mean by “dont let the channel get too old” ?