The easiest way to do this is to pay 2.5% every year on a specific day. So you keep track of the Bitcoin that you've hodled for at least a year, then for that amount you pay 2.5% on and just pay it on that day. This is the best way do it.
You can also pay monthly (I've been forced into doing it this way, don't ask). Same as above method but pay the 2.5% over 12 months, so around 0.2083% per month.
I'd try to pay the btc directly for zakat instead of converting it to fiat, so that way you don't have to constantly recalculate what you owe. Lots of organizations take btc. See nostr:npub1mdggrkkjvr4k33ylk230c6qwnz9ewahsxsa55ygvdc54w2jkrrmq48k309 or icna relief, among many others.
I mean, yeah, that's simplest way to do it. I'm not sure if it's the right way for me, though.
In my case I give Zakat out of pocket in fiat, I never touch the btc itself. What your approach overlooks, is that the fiat value on the DCA-specific day of Nisab is different than the day of giving out Zakat (unless, of course, they coincide). Sometimes you give more than you should, Alhamdulillah. Other times, you give less, then you still owe Zakat.
So, since I have the exact dates of each DCA on the blockchain, I divide them into 12 months, and each month I give out the amount needed. Any extras rollover to the next month account until I reach Shawwal. Shawwal, as it happens, has about 66% of the btc value, and therefore the biggest Zakat amount. After Shawwal, any extras are Sadaqa and I start over.
It's quite complicated in comparison, but I'm not convinced that I should sell btc just to give Zakat, since I can just take fiat out of pocket.
Am I overcomplicating it? Not sure.. But my heart says it's the right thing to do. Hence, the only real alternative for me is give out btc directly. Thus, completely eliminating the whole complexity of the issue.
