Any Forum suggestions to learn about Crypto trading?

[nortac]

Thank you gentlemen for your input and opinions. For the record, I do have a "cold" wallet (electronic hardware not connected to the internet) and I'm using the mentioned security measures.
I look at BTC as a store of wealth and while it's value will probably increase over time, that's not where the major gains are expected to be made. There is expected to be another coin which will exceed BTC's value and growth potential. Hopefully one or more of the altcoins purchased will experience some asymmetrical gains.
I do have some physical gold and silver in an IRA. I have yet to acquire any physical gold or silver for self storage.
I have also acquired some small stakes in the traditional stock market after having previously taken my money out of stocks.
But I'm taking a hands on approach in selecting my stocks, rather than relying on "pre-packaged" offerings in a managed portfolio. I'm retired, so there will be no more pre-tax money coming in.

 

[StillShaving]

Talk to your CPA. If you mine crypto, then it should be ordinary income. If you buy it, hold it for one year and sell it capital gains.

The 12 month rule for capital gains should true of gold, silver etc. also.

If you mean owning physical gold like bars or coins I don’t know. Never bought or sold it.

Thanks for correcting and pointing out my misunderstanding. Or rather my poor memory as I think I was mistranslated the memory of my opinion about its "unfairness" in tax treatment to mean that long term gains are also taxed as income which was incorrect.

I use the term "unfair" in a relative sense in that if one had held an ounce of gold for 10 years it is still the same ounce so why is it subject to being taxed at all. I more or less buy into the idea that gold is a store of value but that is about all, as it does not grow or compound or have any productive use while it sits inside a vault. If Government actions or Federal Reserve policies cause its value to rise in comparison to the dollar, then a slice of it is taken for taxes when sold. Where if the same starting value of money was sitting in a bank account or US treasuries, then only the interest payments would be taxed as income. But I guess that is the main point of those who invest heavily in precious metals or crypto, where they are betting that those commodities will rise in value at a fast enough rate that the profit left after capital gains will be greater than profit left after taxing interest payments on a bank deposit. Or they are really trying to hedge against a worst-case scenario of currency failure but if that happened then crypto or gold is probably not worth as much in their local economy either.

 

[nortac]

Talk to your CPA. If you mine crypto, then it should be ordinary income. If you buy it, hold it for one year and sell it capital gains.

The 12 month rule for capital gains should true of gold, silver etc. also.

If you mean owning physical gold like bars or coins I don’t know. Never bought or sold it.

I don't have a CPA and I'm not wanting to pay for their questionable advice. Of course they have knowledge of tax laws, but I doubt they know jack about crypto. I visited a well known financial planner a year or so ago, but I didn't have enough assets for it to be worth their fees. I'm working with a small amount of capital, so I have to figure it out for myself. If I achieve a certain level of financial gain, then I would be more likely to see a financial advisor.

 

[Berwick12]

Crypto should be a part of your portfolio even if it's only 1%. Zec eth gbtc You can still own a stock and trade on the stock market without getting into a crypto only platform, but you will never own your own Bitcoin yourself. The ability to transfer extremely large amounts in seconds is huge. I do not know enough about crypto. I would be interested in what happens when there's no more Bitcoin to mine. People still need to" process" it so transactions still take place but if there's no "money" in it will they still do that essential piece. I suspect they will because once the supply is run out that's it. It should, should become infinitely more valuable.

 

[The Knize]

I am reminded of the guy who said that if he had more money he would invest in older whiskey, faster horses, and younger women. An the guy who won the lottery, but found himself broke within a few years saying that he spent most of it on whiskey and women, and the rest he just wasted.

Investing is kind of a personal decision in the end. I really have no advice other than to take as much time as one needs to consider the investment so that in case things go very badly, one can still think back and tell oneself that they put sufficient time and effort into thinking about the investment that their deciding to invest was a reasonable decision at the time.


I truly do not know enough about crypto to offer an opinion, and I do not!

 

[nortac]

I probably won't get rich, but perhaps I'll be able to afford better whisky!

 

[StillShaving]

I am reminded of the guy who said that if he had more money he would invest in older whiskey, faster horses, and younger women. An the guy who won the lottery, but found himself broke within a few years saying that he spent most of it on whiskey and women, and the rest he just wasted.

Investing is kind of a personal decision in the end. I really have no advice other than to take as much time as one needs to consider the investment so that in case things go very badly, one can still think back and tell oneself that they put sufficient time and effort into thinking about the investment that their deciding to invest was a reasonable decision at the time.


I truly do not know enough about crypto to offer an opinion, and I do not!

Nice ying-yang in your first paragraph.

I think would rather buy ARKK even though it has had horrible performance over the past decade compared to crypto or anything else. I don't own any Cathy Wood fund (the ARK funds), even though they can be tempting a story as crypto as Ms. Wood has a good investment thesis, but I don't understand her ultimate stock buys.
https://www.visualcapitalist.com/the-12-worst-investment-funds-over-the-past-decade/

But how to hedge against problems is the question that crypto may answer.

 

[The Knize]

Nice ying-yang in your first paragraph.

Thanks! Always good to be investing in something one has has a natural interest in, I suppose.

 

[nortac]

A minor update. The crypto market has drawn back a bit, not unexpected, but I'm still at about a 28% gain, down from a brief high of almost 39%. Don't you just love volatility? At least I haven't lost any principle (yet). Looking forward to see what happens with the BTC "halving" event later this month.

 

[ramare]

I am not a trader and I have some reservations about the foundation that crypto is built upon. Specifically, internet accessibility as a whole, software used to build crypto clients and servers even if some of that software is open source, the complex math algorithms that underpin it, and first world governments continuing to allow it to exist in their economies. I see too many potential downsides to buy.

But I do see the appeal and it is tempting to start a position in BTC, as it continues to grow in value and one can make arguments as to why it will continue to increase in value for the next few years. Especially when comparing to fiat currencies. With the US debt growing by 10 billion every day (1 trillion every 100 days), the USD will need to inflate more and more to avoid implosion which will mean BTC increases in value by sitting still and should accelerate more as people look for investment alternatives. But how to make a net profit if that gain is taxed as income?

The way I frame the question for myself is it more prudent to take a small position in crypto or to buy $MCD (McDonalds stock) instead for example. The price of Big Macs rises at roughly the rate of inflation, but each bitcoin is rising even faster in the present day. I take that as a base case for now, but over a decade or two which will remain viable?

In the near future EVERYTHING will be on blockchain "crypto" but you need to see which companies are using blockchain that have utility. Remember, when everyone is scared that's when you make your move, once the mainstream knows you missed it. Just do your research.

 

[ramare]

A minor update. The crypto market has drawn back a bit, not unexpected, but I'm still at about a 28% gain, down from a brief high of almost 39%. Don't you just love volatility? At least I haven't lost any principle (yet). Looking forward to see what happens with the BTC "halving" event later this month.

Nice, its all in the charts, pullbacks need to happen to climb higher, we are in an uptrend now so just wait for pullbacks to buy in.

 

[Fookistand]

Maybe but Bitcoin doesn't appear to scale very well for day-to-day transactions though it does have mindshare when compared to the altcoins. So which altcoin will gain traction for daily commerce and how would it fare against any future/potential Central Bank issued digital currency?? My concern is that if crypto usage got so widespread that it started to crowd out the (digital) USD, EUR, JPY, CNY, ... I think those respective central banks/governments will crack down and start prohibiting it. Exactly how is unclear but the administration in power could pass laws taxing those transactions, penalizing businesses who transact in them, outright prohibit, etc. The protocols are open by nature so it would not be hard for the miners and blockchain validators to be targeted by the same big gov that its most ardent supporters are trying to protect themselves against.

Crypto might be an easy way to make a large capital gain as more people buy in, but is it truly sustainable in the longer term? I am not predicting it will fail, but there are many unknowns. Advances in computing power have made encryption and ecommerce possible from a small mobile device. Will that march forward effectively break the blockchain's security someday? Highly parallel machines, quantum computing, discovering cracks in the security protocols; any of which could disrupt the current outlook.

My issue with BTC or precious metals is that they do not generate any income. Stocks and real estate if chosen with some care rise in value to offset inflation and generate income while doing so. I think they are a better long-term investment for most folks. Also you can accept bitcoin payments on your website Though as you note, putting a small percentage into crypto might be a good way to boost returns even more.

You raise some very interesting points about the future of cryptocurrency. Here's my take: You're right, Bitcoin's transaction speed isn't ideal for everyday purchases. Some altcoins are designed for faster transactions, but they might lack the widespread adoption of Bitcoin.
CBDCs are definitely a wildcard. If they become widely used, they could impact current cryptocurrencies. However, crypto offers features like decentralization and transparency that CBDCs might not. They could potentially coexist.

Regulation is a valid concern. Governments might try to control crypto, but complete prohibition seems unlikely. Transparency and clear regulations could even be beneficial for the long-term health of the crypto market.
Crypto is still evolving, and there are definitely risks. Advancements in computing power could pose challenges, but blockchain security is constantly being improved.

 

[nortac]

Wow! Further drawback in the crypto market, at least in my portion of it. Still in the black, just barely. BTC halving less than a week away, hopefully a major rebound is in store soon. HODL!

 

[Frito Ray]

hopefully a major rebound is in store soon.

…then it’s stainless razors for everyone!

 

[craigq]

Wow! Further drawback in the crypto market, at least in my portion of it. Still in the black, just barely. BTC halving less than a week away, hopefully a major rebound is in store soon. HODL!

Yup yesterday was wild for the alt-coin market. They have the torque, but it works both in a positive and negative fashion compared to BTCs moves.

 

[JimmyJoeMeeker]

The US government is backing your flat currency. That means a lot….. or nothing.

As long as the government demands payment for taxes in its currency, it means a lot. Likewise for paying its millions of employees, which includes the entirety of the military, and vendors. The dollar isn't going anywhere any time soon.

 

[JimmyJoeMeeker]

Why buy cryptocurrencies? In the hope that someone will be willing to buy them from you for a higher price? Why would anyone do this? Think.

Greater Fool Theory

 

[JimmyJoeMeeker]

I don't invest in anything that doesn't either produce income or have the potential of producing income.

When I feel like gambling, I play the ponies... and expect to lose.

 

[nortac]

Greater Fool Theory

Hopefully, I'm one of the lesser fools!

 

[JimmyJoeMeeker]

Hopefully, I'm one of the lesser fools!

Hopefully so. Note that the concept doesn't imply that one can't make money on greater-fool trades. He just has to rely on market timing... which, again, back to gambling.