Hi! I want to get into speedrunning this game, but I have not (yet) acquired XC2. I was wondering whether not having the 100k starting cash creates a bottleneck at some specific point during the game, or whether it just let's you speed up the first couple of chapters with the early armour/weapon advantage?

In any case, if it's necessary, it might not be a bad idea to get XC2 in the end anyway; is it possible to start practice without it?

Basically, from what I'm gathering, the XC2 money is not very necessary for 1.1.1 and lower but cuts some time out on trading and on collectable RNG, while for version 1.1.2 it helps a bit more because you can abuse it more.
(I'm not totally sure though, so I'll let anyone correct me if I'm wrong.)

Going to elaborate on what Xenoplayed said a little bit more with what I know.
With the assumption you plan to run on Patch 1.0/1.1 (the patch withthe lv50 trick) without the 100k and are going to learn off the current WR that does utilize it.

In Chapter 1, you will have to take on a 1-2 minute sidequest from Dionysus in the Residential District for Light Shoes(as it is a free slotted gear you can obtain early) to equip a Quick Step Gem from Collectables.

At the Refugee Camp and Ether Mines Shops(in Ch.4&5 respectively) I would suggest not purchasing the weapons for Reyn as I believe they aren’t high priority and you should hold off until Alcamoth to trade for a slotted weapon(Sacred Driver). I can’t say how much time you lose from not getting those weapons but you definitely won't have trouble with bosses in between Mechon M71 - Leone Telethia.

At the Nopon Camp Shop in Valak Mountain, you should be fine with skipping the weapon for Dunban too

I mainly say all this as not having the 100k means that you’ll have to be a little bit tighter with your money route up until you hit Sword Valley(about the halfway point of the run), because we want to buy some certain Leggings called Engineer Belt. This has Earth Cloak gem attached which reduces enemy aggro detection making it so we can skip some fights we otherwise would have to fight since you can’t activate buttons or etc. while aggroed.From there you can freely follow TJ’s shopping route as the next shopping done is after a farming session and you would have plenty to sell to be loaded with money.

TL;DR Yes you can run the game fine without the 100k but will need to do some shopping tweaks to the current WR route to accommodate.

Hopefully I didn’t forget anything and that this paints the picture better. Ultimately I think you don’t have to worry about the money unless you plan to get a competitive time.

Thank you both for the answers, and Leon for the detailed answer This helps out a ton, thanks. I'll look into what is more convenient/easier.

As a side note, I do plan on running 1.1.2, since I can't find very solid documentation on how to downgrade (I'm not sure what you're allowed to discuss here either). Are there any resources you'd recommend, or should I just stick with 1.1.2?

The only "intended" way of downgrading is factory resetting your console and using a physical cartridge of the game. However, there is/are (an)other "less intended" way(s), but you'll have to wait for someone else more knowledgeable to respond, or to ask on Discord, not really an expert on the subject ^^'

If you are to downgrade, you would either have to homebrew (don't know the specifics) or factory reset the switch and use a physical copy. If you want to do normal, pre-1.1.2 is recommended as it saves a lot of grinding. As for casual difficulty, 1.1.2 is pretty well routed and no grinding is required to beat the game. Same goes for NG+ categories since they do not use Tephra skip.

Thanks!! I'll check out some things. Thanks for helping me on my way!

Also going to point out with 1.1.2, that quite simply put you are going to need the 100k as one can imagine not being Lv50 makes things drastically different. And as a result of this we need to buy way more gear/equipment to survive the early-game bosses to compensate for not being over leveled, and that’s on Casual, where enemies deal 50% the damage they would on Normal Mode.