So we FINALLY have a SEC approved BTC ETF!

[37andhappy]

Is Bitcoin a Trojen Horse?

Interesting discussion here for those are are interested a little more on the deeper social factors at play here, (and timely for those who may have a more short-sighted view that "its all about the money").

https://youtu.be/3xH1vBuDbBA

 

[pb4uski]

Huh? By this logic that fleet of Tesla electric cars, which everyone knows use vast amounts of electricity, are furthering the world’s reliance on fossil fuels.

True, but at least Tesla cars are providing utility... moving people to and fro... crypto is not providing much utility other than serving as a platform for speculation... so you need to look at electric consumption in relation to utility.

 

[pb4uski]

Yep. Also numerous banks now issue Bitcoin-backed Visa cards. (Basically Bitcoin on the back-end, but transacted on the front end in fiat, seamlessly converted). These types of services are great for global nomads / citizens of the world (whether for lifestyle, business or tax) who live already entirely in Bitcoin as their base currency, but who have the reality of day today transactions in the various countries they are in.

Why would anyone in their right mind select Bitcoin as their base currency when the US$ and EU euro are so easily available?

 

[Markola]

37andhappy, your endurance is admirable. I find it most convincing when people put their money where their mouth is. Given your strong opinions about the flaws in the current financial system and how Bitcoin is the inevitable solution to them, why not go all in and allocate 100% of your portfolio to Bitcoin? Or is your belief in the inevitable failure of the current order and the inevitable dominance of Bitcoin only 1%, 5%, or 10% certain?

 

[ERD50]

....

Second, you actually provide a great example of the misunderstanding of people who take a negative view of Bitcoin (without really understanding the incorrectness of their statements or biasses). For example, the "Oh but Bitcoin uses the amount of electricity of country X" FUD. Such statements are usually made without looking at what proportion of that energy comes from renewable sources of energy that would not ever be utilized for anything else. (Think hydro power in remote locations, solar and wind power in desserts uninhabited by any significant populations, geo thermal in remote locations, etc). ...

And you sir/madam, actually provide a great example of the misunderstanding of people of how the grid and renewables work.

So once again, your evangelicalism uses misguided, distorted 'logic/examples' to try to make your point. As I said, if you are going to make a case for Bitcoin, you are going to need to do better than this.

In failing to do better, you are actually making the case against Bitcoin. If I approach this thread with a neutral mindset, I'm not moved towards Bitcoin at all, by anything you've said.

-ERD50

 

[captain3d]

Definitely a tough crowd in here

 

[Markola]

^^^^ You know, most of us got to where we are by diligently using time-tested principles and avoiding fads and shiny objects (dot coms, biotech stocks, nano tech stocks, penny stocks, nothing-down real estate, chinchilla farming and other delights). Some of us require a higher bar to be convinced.

 

[target2019]

I tried to find some crypto and crime information.

https://www.forbes.com/sites/hailey...ins-role-in-illicit-activity/?sh=6bf3b5833432

"The majority of cryptocurrency is not used for criminal activity. According to an excerpt from Chainalysis’ 2021 report, in 2019, criminal activity represented 2.1% of all cryptocurrency transaction volume (roughly $21.4 billion worth of transfers). In 2020, the criminal share of all cryptocurrency activity fell to just 0.34% ($10.0 billion in transaction volume).

According to the UN, it is estimated that between 2% and 5% of global GDP ($1.6 to $4 trillion) annually is connected with money laundering and illicit activity. This means that criminal activity using cryptocurrency transactions is much smaller than fiat currency and its use is going down year by year."

Definitely a tough crowd in here

Thanks for looking around for the criminal use statistics. Yes, this is a tough crowd. BTC is a controversial topic in the same way Dividends,etc. raises the ire of some frequent posters.

The crux of this divide is that you are solidly in a different generation, and will go forward with coin on your ledger. Whether a pariticular argument is weak or strong, coin will go on irregardless. At a certain age people become hardened to anything that might upset their 100% correct model of the universe. One day this will be you!

I know that coin will continue to take root for many reasons. I offer this article as something that better describes what is going on generationally in Philadelphia, and of course in other cities. I choose to be a simple observer of changes like this, and don't think of it as a battle cry.

https://philadelphiaweekly.com/the-bitcoin-boom-in-philly/

I have mined a small amount of HNT coin in the past six months. I read a book. It's an interesting topic.

 

[joesxm3]

Here is a good interview that explains the reason why some are view Bitcoin as important.

 

[captain3d]

The crux of this divide is that you are solidly in a different generation, and will go forward with coin on your ledger. Whether a pariticular argument is weak or strong, coin will go on irregardless. At a certain age people become hardened to anything that might upset their 100% correct model of the universe. One day this will be you!

Dont get me started on why you should not pay off your mortgage I am actually pretty old and early retired. I have a core amount of investments I need for life and am well diversified including all the normal indexing as well as gold and rentals.

Crypto struck me as a way to diversify further and lower my risk long term. I started small and it has grown into a big chunk equalling other sections in the pie chart.. I am prepared to let it keep growing and the more I find out the more convinced I am it will be important in the future.

It is also a pretty entertaining ride with 80% swings. Great for tax loss harvesting as there is no wash sale 31 day limit as crypto is property.

 

[ERD50]

.... At a certain age people become hardened to anything that might upset their 100% correct model of the universe. One day this will be you!
....

Please don't play the "agism" card on anyone providing critique in this thread.

I have no problem with the idea that some form of electronic currency is the future, in fact I expect it. Maybe we are there already - my investments and accounts are just numbers in a computer now. So I'm interested, but...

the explanations and "whataboutisms" here don't impress me.

Retiring early, DIY investing, and living below your means aren't mainstream ideas either, but most of us here did all those things. Overall, I'd say this is a pretty open minded bunch.

A healthy dose of skepticism is what kept us from someone who wanted to part with our money. But that didn't mean we kept in our mattress either, out of fear of anything new (heck, index funds weren't even common when many of us started investing).

-ERD50

 

[ERD50]

...
It is also a pretty entertaining ride with 80% swings. Great for tax loss harvesting as there is no wash sale 31 day limit as crypto is property.

That's a new one on me. I'm pretty sure any investment that is sold is subject the capital gains rules. Please explain, with IRS links if you have them.

-ERD50

 

[prudent_one]

From this thread and others, a crypto discussion algorithm becomes clear: If a crypto doubter writes one sentence, a crypto evangelist must write two sentences in rebuttal. One questioning paragraph gets two in reply. 8 paragraphs get 16, and so on. It’s 100% ROI!

I think that's why bogleheads banned crypto discussions. The torrent of fanboy posts was just overwhelming. I understand it though, it's the same mindset that MLM proponents have - gotta get people to believe in the dream so they buy in to prop it up.

 

[indiajust]

The Bitcoin ETF owns no bitcoin. The fund trades bitcoin futures, not bitcoin. As bitcoin has generally gone up, the fund could spend most of its time in contango. There is a high likelihood that fund owners will NOT accrue anything close to bitcoin price changes. This is not a buy and hold product.

If you are a speculator, enjoy the game.

This is a certified US government wall street product. It is designed to monetize the flow, not to reward the participants. There are much better ways to play. Futures is a zero sum game. I fear this product treats the customer as a beef cow, not even a milk cow. Be careful.

 

[Gumby]

.....

The crux of this divide is that you are solidly in a different generation, and will go forward with coin on your ledger. Whether a pariticular argument is weak or strong, coin will go on irregardless. At a certain age people become hardened to anything that might upset their 100% correct model of the universe. One day this will be you!.....

I have no interest in the Church of the Holy Algorithm, but I do have strong feelings about the use of the non-word "irregardless".

 

[braumeister]

I have no interest in the Church of the Holy Algorithm, but I do have strong feelings about the use of the non-word "irregardless"

Isn't it funny how we have our pet peeve words?

I share your dislike for irregardless, and remember my father's extreme annoyance at another word. He would get very exercised about people who were said to disembark from a ship or plane. "You embarked on the voyage, and at the end you debarked." To "disembark" is exactly as bad as irregardless. Pretty much nobody agreed with him, but he was adamant about it.

 

[tenant13]

That's a new one on me. I'm pretty sure any investment that is sold is subject the capital gains rules. Please explain, with IRS links if you have them.

-ERD50

The wash sale rule will likely be applied to cryptos soon.

https://www.thestreet.com/.amp/retirement/cryptocurrency-may-soon-be-subject-wash-sale-rule

 

[DougJohnson]

We know for certain that ALL BANKS are inherently unethical (in that their entire purpose is to make money from their customers).

Eh? Don't all for profit companies have that as their purpose? If banks provide a service that people are willing to pay for, how is that unethical?

OK, I know some banks have unethical practices, e.g. Wells Fargo But that doesn't seem to be an intrinsic property of banking.

-- Doug

 

[Markola]

I have no interest in the Church of the Holy Algorithm, but I do have strong feelings about the use of the non-word "irregardless".

LOL. Me, too. It appears you have two options for all that past history as you ramp up your out of the box thinking.

 

[RobbieB]

I've heard numerous times that if you don't understand something, you shouldn't invest in it. Yeah, I've read about the bitcoin process and I still don't understand it.

So, not going to invest either.

 

[Markola]

^^^^ Yeah, that’s where I am. I see it providing exactly zero utility in my daily life, but I read about a lot of people speculating on it. I don’t speculate. I invest in businesses that generate dividends, interest or the promise of them. And I own a house.

So here’s a question. I have not found that old code functions very well in any area of my life. Doing anything on most any government website is a trip back to the 1990s, for example. Bitcoin began use in 2009, which means it will be 20 year old code in only 8 years. Then 30 year old code, then 40 year old code. I also don’t invest in gold but at least it doesn’t get moldy and can’t be hacked by Russians. What do I not understand about the long-term, permanent resilience of Bitcoin code?

 

[captain3d]

That's a new one on me. I'm pretty sure any investment that is sold is subject the capital gains rules. Please explain, with IRS links if you have them.

-ERD50

Example of what happened this year:
Buy Bitcoin at $60k
Sell at $30k after drop and immediately rebuy at $30k
Record -$30k of (capital loss)
Watch it go back up to $60k

You do not need to wait for 31 days to rebuy as you would with stocks. Gold is also property/currency and has no wash sale issues as far as I know.

How long for is another question...
https://www.cnbc.com/2021/09/14/hou...e-tax-loophole-used-by-crypto-investors-.html

"The IRS treats crypto as property, not as a security, which is how the asset class escapes the rules.

Crypto investors reap two benefits as a result: They can sell crypto for a loss and claim a tax benefit. (That loss can reduce or eliminate capital gains tax on winning investments.) Then, they can quickly buy back the crypto they sold to capture any rebound in price — which isn’t far-fetched given crypto’s volatility."


And yes any gain is a tax able gain. But I was talking about tax loss harvesting.

 

[captain3d]

^^^^ Yeah, that’s where I am. I see it providing exactly zero utility in my daily life, but I read about a lot of people speculating on it. I don’t speculate. I invest in businesses that generate dividends, interest or the promise of them. And I own a house.

So here’s a question. I have not found that old code functions very well in any area of my life. Doing anything on most any government website is a trip back to the 1990s, for example. Bitcoin began use in 2009, which means it will be 20 year old code in only 8 years. Then 30 year old code, then 40 year old code. I also don’t invest in gold but at least it doesn’t get moldy and can’t be hacked by Russians. What do I not understand about the long-term, permanent resilience of Bitcoin code?

It is not frozen in time. Developers actively work on it for improvements without disturbing the original foundation.

https://decrypt.co/66740/who-are-the-fastest-growing-developer-communities-in-crypto

"There are more than 8,000 monthly active developers working on various cryptocurrency projects, according to the Developer Report, produced by Electric Capital, a venture firm, with some 80% of those developers starting in the last two years. "

Gold can certainly be hacked. Fake bars have been found. Nothings is 100% safe of course.

 

[ERD50]

Example of what happened this year:
Buy Bitcoin at $60k
Sell at $30k after drop and immediately rebuy at $30k
Record -$30k of (capital loss)
Watch it go back up to $60k

You do not need to wait for 31 days to rebuy as you would with stocks. Gold is also property/currency and has no wash sale issues as far as I know.

How long for is another question...
https://www.cnbc.com/2021/09/14/hou...e-tax-loophole-used-by-crypto-investors-.html

"The IRS treats crypto as property, not as a security, which is how the asset class escapes the rules.

Crypto investors reap two benefits as a result: They can sell crypto for a loss and claim a tax benefit. (That loss can reduce or eliminate capital gains tax on winning investments.) Then, they can quickly buy back the crypto they sold to capture any rebound in price — which isn’t far-fetched given crypto’s volatility."


And yes any gain is a tax able gain. But I was talking about tax loss harvesting.

OK, thanks - interesting. The googling I did, it seemed like 'property' covered anything that was owned, as sold for a profit/loss.

But, trying to apply logic to IRS rules (rules created by Congress, just so we don't misplace the blame) is often a futile task anyhow.

-ERD50

 

[captain3d]

I did some tax loss crypto sales on the taxable side and rebought crypto close end fund (GBTC ETHE) on the retirement side just to be sure they were clearly separated. But in theory you can currently do it all on the taxable side right now.