NatterJackToad

The Bubbly Bitcoin Thread -- Merged Threads

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Another one I'm watching is IOTA, it just got added to Bitfinex today.

If there continues to be scalability problems with BTC and ETH, I can see the hype machine gearing up on this one.

I don't know enough of the technical details to qualify it. It's just a hunch. Have a read up on it.

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Anecdotally I had to call the bank to set up a SEPA transfer today which is a manual process over the phone and the woman recognised the Bitcoin exchange immediately, said that many many people have been transferring out this way  especially over the last month or so and advised that as of July SEPA  would be an automatic online process for this particular banking institution which implies they recognise the amounts going out to it.

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On 6/13/2017 at 4:46 PM, adamLancs said:

Another one I'm watching is IOTA, it just got added to Bitfinex today.

If there continues to be scalability problems with BTC and ETH, I can see the hype machine gearing up on this one.

I don't know enough of the technical details to qualify it. It's just a hunch. Have a read up on it.

I just read the white paper. I honestly have no idea what the point of it is. Also it seems to have some very bizarre small fixed proof of work. SInce all iotas were issued at the start I just don't get what the incentive for running a node is or how iotas are equitably distributed, or what is stopping someone hijacking the network through virtualisation (since the POF is apparently fairly trivial).

Edited by goldbug9999

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11 hours ago, Iwenti said:

With the bitcoin increasing its penetration in the market. It might come in the radar of hackers.

??? so hackers have up to now been ignoring a public protocol that safeguards 30 odd billion pounds have they ?.

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On 22 October 2013 at 9:44 AM, NatterJackToad said:

http://i.imgur.com/xSOW1NG.jpg

now back over $200.... where next?

Bitcoin seems to be growing very nicely, the growth is so solid that it keeps getting ahead of itself and having mini bubbles (on the uptrend) and bear traps.

i think it's looking like a buying opportunity right now. 

 

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On 13/06/2017 at 3:41 PM, Errol said:
If this passes which seems very likely, it will shove a huge spanner into the wheels of cryptocurrency.
 
A big part of the appeal of bitcoin is the complete anonymity. Once you force all the exchanges to collect ID and report income for tax purposes this has the side effect of making the blockchain into a public record of every transaction you have ever made. i.e. big brother is watching you.

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Crypto is not a product of the US, the more the US has done to stifle it, the more distributed it has become. There is quite a nice free market counterbalance acting against the US government in this regard, and the same can be said for the Chinese.

Bitcoin never offered complete anonymity. Most of the exchanges already follow regulations and collect ID except for very small amounts, and most of them are probably reporting balances in some way to state departments of their respective country.

The only real way to avoid paying tax is to not cash out and to not send your coins to an exchange. That's something that is increasingly unlikely... most people want to take profit at these prices. Whether it is Bitcoin, Litecoin, Monero, Dash etc does not matter unless you are dealing with small amounts. You will come under the radar of the IRS at the point that you exchange for $. And they can look a long way back, something like 7 or 11 years IIRC.

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1 hour ago, Habeas Domus said:
If this passes which seems very likely, it will shove a huge spanner into the wheels of cryptocurrency.
 
A big part of the appeal of bitcoin is the complete anonymity. Once you force all the exchanges to collect ID and report income for tax purposes this has the side effect of making the blockchain into a public record of every transaction you have ever made. i.e. big brother is watching you.

The harder they push the harder the market will push back. We are not very far away from anonymous transactions and decentralised exchanges.

In the end it will be like passing bills to ban the tide from coming in; they are dealing with powers out of their control.

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Brutal takedown of Bancor for anyone interested. http://hackingdistributed.com/2017/06/19/bancor-is-flawed/

(I doubt the price of this one is going to hold up, given the scrutiny it's coming under. It seems like it's better to invest in vapourware - e.g., Golem, Gnosis - than in projects with actual publicly available code :rolleyes:.)

Edited by Darby Ram

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2 hours ago, adamLancs said:

The only real way to avoid paying tax is to not cash out and to not send your coins to an exchange. That's something that is increasingly unlikely... most people want to take profit at these prices. Whether it is Bitcoin, Litecoin, Monero, Dash etc does not matter unless you are dealing with small amounts. You will come under the radar of the IRS at the point that you exchange for $. And they can look a long way back, something like 7 or 11 years IIRC.

"most people want to take profit at these prices" - I don't think so and recent price relative stability of BTC around the £2000 mark doesnt bear this out. My personal plan is keep cryptos for 5-10 years at which point you will be able to buy a lot stuff directly.

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What are the tax rules on trading alts but never selling them for sterling? Say a person buys BTS then trades LTC, ETH with it etc. Then after many years sells it all for GBP? Is every transaction taxed or only the capital gains of the last one?

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3 minutes ago, lombardo said:

What are the tax rules on trading alts but never selling them for sterling? Say a person buys BTS then trades LTC, ETH with it etc. Then after many years sells it all for GBP? Is every transaction taxed or only the capital gains of the last one?

Its a really interesting question - i was pondering too. I have never switched to any form of fiat in any of my trades (although the effective values have been quite small and nowhere near a cgt problem).

My gut feeling is that whatever you initially bought the coins for (assuming you bought them and didn't mine them) is the starting point, and the difference between that and the final fiat value is what the tax man would look at. 

Technically they could 'allocate' a value at each point I.e say hypothetically

Bought 10 btc for £3k in 2016.

Sold 10 btc (valued then at £8000 iirc) for 500eth in Jan 2017. Capital gain is 5k.

Sold 500 eth (150k gbp) for 80btc June 2017. Capital gain a hypothetical 145k - tax owed on difference? But how do you realise the cash I such a transaction? Do you have to sell 20 btc to do so, or have ready cash to cover?

Who knows? To some extent this is like a barter transaction and I'm not sure you pay cgt on those. If someone bought an e type jag in the 60s and swapped it for two ducati desmosedicis right now, would the taxman stick their oar in? 

I have serious doubts this has ever been discussed by the authorities - its very niche. 

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They can only tax cash ££.

Hence why they dont like it.

If you can purchase in bitcoin, there is no reason to realise any gains in toilet paper £.

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5 hours ago, Darby Ram said:

Brutal takedown of Bancor for anyone interested. http://hackingdistributed.com/2017/06/19/bancor-is-flawed/

(I doubt the price of this one is going to hold up, given the scrutiny it's coming under. It seems like it's better to invest in vapourware - e.g., Golem, Gnosis - than in projects with actual publicly available code :rolleyes:.)

Golem had plenty of code available well before the crowdsale. Gnosis also have code available although I don't know the full extent. Bancor actually had very little code available.

1 hour ago, Frugal Git said:

Its a really interesting question - i was pondering too. I have never switched to any form of fiat in any of my trades (although the effective values have been quite small and nowhere near a cgt problem).

My gut feeling is that whatever you initially bought the coins for (assuming you bought them and didn't mine them) is the starting point, and the difference between that and the final fiat value is what the tax man would look at. 

I'm prepared for this to all change but the advice I was given was as above. 

Also note that as soon as you use your cryptocurrency for real world purposes you must declare it, as you must also if you get paid in cryptocurrency. Companies like Xapo allow a full transaction export for these purposes.

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10 hours ago, Habeas Domus said:
A big part of the appeal of bitcoin is the complete anonymity. Once you force all the exchanges to collect ID and report income for tax purposes this has the side effect of making the blockchain into a public record of every transaction you have ever made. 

Just do bitcoin -> monero -> bitcoin and viola, you now have bitcoin at an untraceable address.

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So £5's worth of bitshares I bought 2 years ago are now worth $1000 and it seems I've lost my wallet, and hence the money. LOL

Oh well, such is life.

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22 minutes ago, Errol said:

Denninger of the Market-Ticker doesn't like Bitcoin or any of the 'digital currencies'. To put it mildly!

I'm not passing any comment, just posting it here. 

 

Digital 'Currencies' Are ALL A Scam

https://market-ticker.org/akcs-www?post=232141

I didn't read the whole article as there were so many refutable points in the first couple of paragraphs.

A currency relies on network effects so although a infinite amount of competing protocols can be created all value will gravitate towards a few dominant ones.

His argument on deflationary equals less people able to use is not true related to digital currencies as they are infinitely divisible. The whole world could transact using a single bitcoin. It is deflationary in te sense that more people can use it without having to dilute hloders.

I am sure there are may other points that can be as easily knocked down.

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25 minutes ago, Errol said:

Denninger of the Market-Ticker doesn't like Bitcoin or any of the 'digital currencies'. To put it mildly!

I'm not passing any comment, just posting it here. 

 

Digital 'Currencies' Are ALL A Scam

https://market-ticker.org/akcs-www?post=232141

Pretty bad article. Incorrect in almost every aspect.

From mining always increasing in difficulty (no, it adapts to computing power), to exchanges not having a business model (isn't a fee when transferring between fiat a good model, like coinbase does?)

And I don't agree with the point about deflation leading to valueless. If we couldn't mine any more gold I doubt it would end up valueless

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I have a couple of doubts when it comes to cryptocurrencies

1) the supply is limited but the number of cryptocurrencies isn't
2) they can be regulated at any moment in time in a way which could wipe most of their value
3) (although those into them seem to ignore it) they rely on internet connection and computers, unlike PMs and fiat moneyz.

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29 minutes ago, Elative said:

I have a couple of doubts when it comes to cryptocurrencies

1) the supply is limited but the number of cryptocurrencies isn't
2) they can be regulated at any moment in time in a way which could wipe most of their value
3) (although those into them seem to ignore it) they rely on internet connection and computers, unlike PMs and fiat moneyz.

It seems there are several variations of interest in the currency/technology

1. The people who see the end of the world in diluted paper money (i.e Roman currency collapse ) and are moving to anything for a store of value (same as all those buried pots of gold people find from Roman times - its an age old problem when people devalue currencies)

2. People believe applications will run on public blockchain networks and they will be rewarded (by receiving coins) for validating the transaction on the blockchain

3. People who value the underlying tech - blockchain, the creation of private block chains are essentially distributed database network nodes which can validate anything with ultimate security (so far untested!). It is the equivalent of the invention of the database. Useful theoretically, but until Oracle came along and built a business it was on the margins of academia as a nice idea.

4. Hangers on who ride momentum but don't care about anything except that other people care about crypto

Like anything new, there is always a cambrian explosion of new uses for a particular technology, then as time progresses, one or two move up to the next level and take all market share.Its either a new way of transferring value e.g cryptocurrency OR its just a new way of confirming trust in transactions. Either way, people believe the coins are worth something so they are - much like paper currency is. Do you believe the USD will grow enough to overcome its deficit drag? warren buffett does, if you do then the debt is irrelevant and USD will continue based on the ingenuity of its people to produce something the world needs. Ultimately the value of anything is dependent on its usage amongst the community. The use cases are clearly still forming. It seems similar to the internet in that regard. In 1989 who thought you'd have Netflix on the ARPANet? Same applies here, new use cases which add value will be created. Whomever gets the widest number of smart developers will win this battle. As consumers, you'll either back VHS or Betamax!

 

Edited by katchytitle
edit

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