Finally gave in….first crypto purchase today

[CaliKid]

I jumped in recently too with a VERY small amount. My friend has been nagging me for several years to do it and I finally gave in. Very easy to purchase through Venmo. I am doing a set small amount each week. Just gambling money!

 

[Born2Fish]

GBTC and ETHE (Bitcoin & Ethereum)close end funds are available in my iras at Td Ameritrade.

Currently at a discount and maybe an easy way for others to get crypto exposure through their existing brokerage.

I just bought 25 shares of each in my TDA IRA acct. I will add every month (or on large dips) until I have ~ $5k total.

If the claims of the faithful are true then over time these should move up. I know myself well enough to know that I [-]may [/-]will take profit at some point and reload.

I bought GBTC and sold 3 days later for a 10% profit back in Feb, 2021.

 

[sengsational]

I bought $25 worth in Venmo, and they gave me $25 credit. Did I invest in Bitcoin? I'm going to say "no", because my basis is zero. But if I do nothing else, I beat most Bitcoin investors because my rate of return is infinite!

 

[misanman]

I bought some Bitcoin early the year via the Cash app. It's been pretty volatile but currently up about 20%.

 

[Born2Fish]

I bought some Bitcoin early the year via the Cash app. It's been pretty volatile but currently up about 20%.

What is the "Cash App"?

 

[Born2Fish]

What is the "Cash App"?

Ok...Found it with Google search.

Can anyone familiar with this process describe the steps?

My fear with buying direct is that a hacker will access the transaction and gain access to my BTC.

 

[teetee]

The last few times I used my gut feeling in stock trading allowed me to learn how to salvage losses during tax filing.

After knowing the amount of energy used for the crypto mining I am convinced it is not a sustainable model. That is my gut feeling telling me it is not something I should treat a long term investment.

 

[OneMarcilV]

It may be a Patriot Act requirement but still not something I would do to buy crypto, not that I would buy crypto anyway.

I agree. Would stay with Pay Pal.

 

[OneMarcilV]

My thinking is that it is an interesting topic. At this stage we don't need another account with another asset to track. But I think your course is prudent. Why not try something to see what all the noise is about?

True one bank account is enough.

 

[OneMarcilV]

I bought a small amount of crypto ($1K) through PayPal in late 2020, split between their 4 offerings. I’ve since recovered my initial investment and am waiting to see the 1099-Bs that PayPal will send. I won’t sell any more until the tax at LTCG rates kicks in.

After that, I’ll treat it like cash back rewards, just occasional sales if/when it rises.

It’s been interesting to follow the price swings.

I would think there would be a certain amount you can sell and not have to pay taxes on.

List like working at a job. There is a certain amount you can earn without having to pay taxes.

Not very much though.

 

[OneMarcilV]

Ok...Found it with Google search.

Can anyone familiar with this process describe the steps?

My fear with buying direct is that a hacker will access the transaction and gain access to my BTC.

That is why I would not send a driving licence to these peeps.

 

[steelyman]

I would think there would be a certain amount you can sell and not have to pay taxes on.

List like working at a job. There is a certain amount you can earn without having to pay taxes.

Not very much though.

I think you may be correct. That’s why I’m OK to wait for the 1099s and see how it turns out.

 

[Jerry1]

Would spending it on something be the same for tax purposes as selling it? Not sure if crypto is considered a currency or just another asset class like a stock.

 

[misanman]

What is the "Cash App"?

Cash App is a peer-to-peer money transfer service developed by Square Inc. that allows users to send and receive money. This service can help you send your share of utilities to your roommates, pay friends back for coffee, split the cost of a trip or any other money-sending task you want to accomplish with other Cash App users. Cash App also functions similarly to a bank account, giving users a debit card — called a “Cash Card” — that allows them to make purchases using the funds in their Cash App account. The app also allows users to invest their money in stocks and buy and sell bitcoin.

I don't specifically remember the steps but it seemed like it took about 5 minutes. It probably was longer but very quick. It links to your bank account so that could be a concern for some people.

 

[Sojourner]

I'll probably do some options trading in the crypto space by selling monthly puts on BITO, once it's got a bit more of a track record. I don't have any real interest in buying something like Bitcoin or Ethereum directly, just as I've never dabbled in other currency or precious metals investments.

 

[jazz4cash]

If they require DL info, do they at least have a secure message service. Putting it in an email seems risky but I think I have provided DL # on various web forms for established, well known recipients.

 

[Kalm]

Bought $500 in crypto (split between BTC & ETH) today as a starting point and will continue to allocate 1% of gross earnings per month. My gut tells me it has reached a point where I can no longer ignore it. Where are you in your thinking or already established journey with crypto? Curious to hear from others on this topic!

I bought some Crypto through Coinbase. I subscribe to a crypto newsletter for guidance since there are too many cryptos to choose from! It’s wise to know which crypto’s are scams and which are legit. I like Coinbase because one can earn free crypto just by learning about it and taking a few quizzes. Also Coinbase has a built in digital wallet so one doesn’t have to jump through hoops installing a digital wallet on a separate platform. It’s best to store your cryptos in a digital wallet/vault as hackers can steal cryptos if they are not stored in a vault. I have a small position and have so far have doubled my investment since I started 6 months ago. But it’s wise to adhere to the advise of not investing more than you are willing to lose! Good luck!

 

[OneMarcilV]

If they require DL info, do they at least have a secure message service. Putting it in an email seems risky but I think I have provided DL # on various web forms for established, well known recipients.

Could be someone at these places that be scammers that the company does not know about. Still who knows who sees your driving license.

See if Pay Pal doesn’t ask for a driving license why do these sellers do?

 

[moneymaker]

Couldn’t someone at vanguard or fidelity take your money too?

This forum sounds like what folks were discussing when the stock market was invented.

Just look at the historical returns of Bitcoin the last 10 years.

 

[OneMarcilV]

Couldn’t someone at vanguard or fidelity take your money too?

This forum sounds like what folks were discussing when the stock market was invented.

Just look at the historical returns of Bitcoin the last 10 years.

With those you do not have to send a copy of one’s driving license.

 

[captain3d]

Would spending it on something be the same for tax purposes as selling it? Not sure if crypto is considered a currency or just another asset class like a stock.

Crypto is considered ‘property’ same as gold so technically any transaction is a taxable event today

 

[37andhappy]

Bought $500 in crypto (split between BTC & ETH) today as a starting point and will continue to allocate 1% of gross earnings per month. My gut tells me it has reached a point where I can no longer ignore it. Where are you in your thinking or already established journey with crypto? Curious to hear from others on this topic!

I think this is exactly the right approach. History may well show that your decision to start allocating to BTC now, is one of the most significant you have ever made in terms of protecting and building your future wealth and freedom.

Many of us are still in a privileged enough position to establish ourselves in the monetary system of the future as "whole-coiners". This opportunity, is of course slowly slipping away as Bitcoin's global adoption continues, and for many in the world is already an almost impossible dream.

I would suggest you view Bitcoin as the base-layer of the global digital monetary network of the future, and then look at all the "alts", (including ETH), as protocols (among which there will be huge longer term competition and inter-dilution among an infinite supply of new entrants).

My view (and the "standard" allocation) to anyone new to the space is 70% Bitcoin, 20%ETH, (and 10% alts if you want to have a little speculative fun on future "projects"). Or even more straightforward, simply stick to stacking Sats and remain 100% focussed and supportive of Bitcoin.

It is essential that you are custodying via a reputable provider, or ideally, in my view, self-custodying (provided you know how to do this safely), or some combination thereof.

Finally, do not be put off (and indeed be prepared) for price volatility. Ignore the "noise" and the FUD, and look at the long term picture. 10 years from now, we will look back and be amazed at the extent Bitcoin has colonized, cannibalized and displaced existing and entrenched financial systems, and how much wealth has flowed into this amazing new asset class.

 

[37andhappy]

Out goes the window one of the crypto tenets - anonymity.

There are plenty of ways to acquire, hold and utilize Bitcoin with it being associated with your identity. (For example, simply buy and/or sell peer to peer, outside of any regulated exchange or financial institution).

But yes, if you buy via a US-regulated exchange (which in turn complies with KYC obligations), and if you have provided truthful identification documents to that provider which can be used to identify you, then there may well be a US Government record of your purchase.

 

[SecondAttempt]

Crypto is considered ‘property’ same as gold so technically any transaction is a taxable event today

When I had my taxes done this year my EA asked if I owned any crypto currency at any time during the year. "No" was my answer so no followup. But I'm pretty sure it was to cover the EA's butt in case I had any unreported transactions. We will probably see this quesion on our tax returns in the near future so I suggest you keep very good records.

As Americans we are required to report any foreign financial accounts of any value on our tax form every year. So while the rules around crypto may be unclear, having an account on a non-US crypto exchange is probably reportable. Bitcoin may be property but holding it in an account with an exchange probably makes it a financial account in my opinion. If you hold physical gold in an account it is considered a financial account I believe. Not a test case I would want to pay to fight.

The last time I boarded an international flight out of the US I was confronted by a customs agent in the jetway. She asked me how much currency I had on my person. I'm pretty sure I was not required to answer if it was less than $10,000. (I had about $500 and about 300 EUR.) But I'm also pretty sure not answering would have messed up my trip at the very least.

Now I'm wondering...if I had a USB drive with keys to a bitcoin wallet with let's say 1/2 BTC, would I have had to report it? What if the keys were on my laptop in a way I was not aware of?

 

[SecondAttempt]

Just look at the historical returns of Bitcoin the last 10 years.

The trouble is that most of it (~90%) has been in the last 1.5 years. Would you but a stock with that kind of recent runup?