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Bubble bursting? http://www.bbc.co.uk/news/business-42457983
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In reply to balmybaldwin:
There was an interesting graphic doing the rounds this week of Google searches and BTC value...which tightly mapped.....
> Bubble bursting? http://www.bbc.co.uk/news/business-42457983
There was an interesting graphic doing the rounds this week of Google searches and BTC value...which tightly mapped.....
In reply to balmybaldwin:
No.
A quote from the article for you: Charles Hayter, founder and chief executive of industry website Cryptocompare, said: "A manic upward swing led by the herd will be followed by a downturn as the emotional sentiment changes."
He said a lot of traders would have been cashing in on the spectacular gains made over the year.
It's not going to crash anytime soon. For example, I needed some extra money this month - so sold some of my BC. Sure I'm not the only one liquidating investments at this time of year. Lots of sellers = fall in price.
No.
A quote from the article for you: Charles Hayter, founder and chief executive of industry website Cryptocompare, said: "A manic upward swing led by the herd will be followed by a downturn as the emotional sentiment changes."
He said a lot of traders would have been cashing in on the spectacular gains made over the year.
It's not going to crash anytime soon. For example, I needed some extra money this month - so sold some of my BC. Sure I'm not the only one liquidating investments at this time of year. Lots of sellers = fall in price.
Post edited at 15:23
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In reply to Shani:
What I don't get is where the value is derived from.... the mining is just creating more block chain, and consuming power...unless I'm mistaken there is no intrinsic value
What I don't get is where the value is derived from.... the mining is just creating more block chain, and consuming power...unless I'm mistaken there is no intrinsic value
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In reply to balmybaldwin:
Correct. There is no major intrinsic value. Furthermore it is now pretty much as centralized as normal money - almost all mining of bitcoin is done by a few places, there are very few exchanges, things like protocol updates are decided by the miner pool (IIRC). It also often has transaction times of hours or days. It’s not even good for anonymous crime - all transactions are in the open forever - police just need to know who the exchange buys from (which is allegedly easier than before).
Intrinsically speaking - most other coins are better than bitcoin, because they built on the tech bitcoin started and could avoid some of these flaws.
From what I’ve read, the best future use is not as a currency, but as a settlement tool. It transparently can record transactions forever.
Correct. There is no major intrinsic value. Furthermore it is now pretty much as centralized as normal money - almost all mining of bitcoin is done by a few places, there are very few exchanges, things like protocol updates are decided by the miner pool (IIRC). It also often has transaction times of hours or days. It’s not even good for anonymous crime - all transactions are in the open forever - police just need to know who the exchange buys from (which is allegedly easier than before).
Intrinsically speaking - most other coins are better than bitcoin, because they built on the tech bitcoin started and could avoid some of these flaws.
From what I’ve read, the best future use is not as a currency, but as a settlement tool. It transparently can record transactions forever.
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In reply to balmybaldwin:
I know it sounds trite/patronising (it's not meant to be), but you have to understand what *money* actually *is* (especially since the break with the gold standard), before you can understand why Bitcoin *satisfies* the definition of money.
> What I don't get is where the value is derived from.... the mining is just creating more block chain, and consuming power...unless I'm mistaken there is no intrinsic value
I know it sounds trite/patronising (it's not meant to be), but you have to understand what *money* actually *is* (especially since the break with the gold standard), before you can understand why Bitcoin *satisfies* the definition of money.
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In reply to MG: you can say exactly the same of gold or little pictures of the queen. Or the digital money in your high street bank account that actually doesn't exist as a 'real' piece of money anywhere.
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In reply to wbo:
Gold has real intrinsic value. It can be made into jewellery, used for IC manufacture, used for pretty much anything copper gets used for (as in - gold will always have an intrinsic worth at least as much as copper).
Gold has real intrinsic value. It can be made into jewellery, used for IC manufacture, used for pretty much anything copper gets used for (as in - gold will always have an intrinsic worth at least as much as copper).
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In reply to wbo:
I don't use either as money
> Or the digital money in your high street bank account that actually doesn't exist as a 'real' piece of money anywhere.
No that works just fine as a store of value.
> you can say exactly the same of gold or little pictures of the queen.
I don't use either as money
> Or the digital money in your high street bank account that actually doesn't exist as a 'real' piece of money anywhere.
No that works just fine as a store of value.
Post edited at 17:46
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In reply to SenzuBean: but it isn't priced the same as copper is it, and that isn't because it's so super duper practical.. Helped by being soft and easy to work in ancient times it's worth a lot of money for pretty arbitrary reasons, like making nice jewejjery.
Mg; well in terms of buying things Bitcoin is money, just with a wobbly exchange. In terms of safety, don't think that if your bank went bust you'd necessarily get all your money back.
Do you think that if a bank went pop do you think that a banks total assets will cover its debts?
Mg; well in terms of buying things Bitcoin is money, just with a wobbly exchange. In terms of safety, don't think that if your bank went bust you'd necessarily get all your money back.
Do you think that if a bank went pop do you think that a banks total assets will cover its debts?
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In reply to MG:
Not really. The interest you get from banks is less than inflation so your money is worth less every year. The central bank will print money whenever it suits it and the pound will likely lose value either because of Brexit if the Tories stay in power or because of whatever socialism Jeremy Corbyn dreams up.
Bitcoin on the other hand has a deflationary monetary policy hardwired in and doesn't give two f*cks about the Bank of England or Jeremy Corbyn. As a store of value Bitcoin is pretty close to ideal.
> > Or the digital money in your high street bank account that actually doesn't exist as a 'real' piece of money anywhere.
> No that works just fine as a store of value.
Not really. The interest you get from banks is less than inflation so your money is worth less every year. The central bank will print money whenever it suits it and the pound will likely lose value either because of Brexit if the Tories stay in power or because of whatever socialism Jeremy Corbyn dreams up.
Bitcoin on the other hand has a deflationary monetary policy hardwired in and doesn't give two f*cks about the Bank of England or Jeremy Corbyn. As a store of value Bitcoin is pretty close to ideal.
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In reply to tom_in_edinburgh:
Thats obvious cobblers. If id.used it to store my money this morning... Yes cash is imperfect but outside e.g. Zimbabwe works well on a day to day, year to year basis.
> As a store of value Bitcoin is pretty close to ideal.
Thats obvious cobblers. If id.used it to store my money this morning... Yes cash is imperfect but outside e.g. Zimbabwe works well on a day to day, year to year basis.
In reply to wbo:
Hence the various government promises to prevent a crash and increase confidence. What reassurance does Bitcoin offer?
> Do you think that if a bank went pop do you think that a banks total assets will cover its debts?
Hence the various government promises to prevent a crash and increase confidence. What reassurance does Bitcoin offer?
In reply to tom_in_edinburgh:
It's arguably so secure that the processing power required to maintain it, is likely to be it's downfall?
It's arguably so secure that the processing power required to maintain it, is likely to be it's downfall?
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In reply to MG: As all threads need an oblig. Brexit reference, 20% drop in the value off the pound. Compared to me your assets, wealth, were instantly reduced in value.
To Summo - none. But I remember 2plus dollar to the pound. And what % of Northern Rock was covered?
To Summo - none. But I remember 2plus dollar to the pound. And what % of Northern Rock was covered?
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In reply to summo:
1. There will never be more than 21 million Bitcoin.
2. If you keep your secret key secret nobody can touch your bitcoin.
3. You can send and receive Bitcoin from any address you like.
> Hence the various government promises to prevent a crash and increase confidence. What reassurance does Bitcoin offer?
1. There will never be more than 21 million Bitcoin.
2. If you keep your secret key secret nobody can touch your bitcoin.
3. You can send and receive Bitcoin from any address you like.
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In reply to tom_in_edinburgh:
I can do that with pounds.
> 1. There will never be more than 21 million Bitcoin.
How does that help matters> 2. If you keep your secret key secret nobody can touch your bitcoin.
http://www.independent.co.uk/news/business/news/bitcoin-latest-updates-nort...> 3. You can send and receive Bitcoin from any address you like.
I can do that with pounds.
In reply to tom_in_edinburgh:
I meant the ever increasing computing power required to maintain it.
Also what happens when it reaches peak value and full release. It can only go one way.
I meant the ever increasing computing power required to maintain it.
Also what happens when it reaches peak value and full release. It can only go one way.
In reply to tom_in_edinburgh:
> 1. There will never be more than 21 million Bitcoin.
And? > 2. If you keep your secret key secret nobody can touch your bitcoin.
I have bank account and a pin.> 3. You can send and receive Bitcoin from any address you like.
I can go online. In reply to wbo:
Hence why in Europe, at least, they have since promised to guarantee £50k per account.
> To Summo - . And what % of Northern Rock was covered?
Hence why in Europe, at least, they have since promised to guarantee £50k per account.
In reply to MG:
The price of most things is determined by scarcity. That's why governments need to hide away gold in vaults and DeBeers and the Russians need to collude to manage the supply of diamonds. Bitcoin has scarcity built in, unlike fiat currency with managed inflation there is a hard limit.
If your Bitcoin is on an exchange it isn't in your wallet protected by your secret keys, it's in the exchange's wallet. Putting your Bitcoin onto an exchange puts you in the same situation as putting your dollars in a bank.
If you keep your Bitcoin in your own wallet and you keep the keys secret then nobody, not the courts, not the government, not the taxman, not your ex-wife can get at it without getting their hands on the private key. If it;s in a bank they'll get a court order and you are stuffed.
You can ask a bank nicely to do it for you and they'll charge you a packet, give you a sh*tty exchange rate and make you wait and track the whole thing and report it to government and if they don't like what they think you are doing they'll freeze the payment or shut your account. Which is inconvenient if you are a US citizen and want to bet on sports or play poker for money online or a South Korean citizen with currency controls stopping them spending money abroad or, admittedly, a bunch of less pleasant things.
Bitcoin isn't the best of the crypto currencies for paying for goods but with Ethereum you just bring up an app on your PC type in the address you want to send it and in ten minutes it's done for a tiny fee.
> How does that help matters
The price of most things is determined by scarcity. That's why governments need to hide away gold in vaults and DeBeers and the Russians need to collude to manage the supply of diamonds. Bitcoin has scarcity built in, unlike fiat currency with managed inflation there is a hard limit.
If your Bitcoin is on an exchange it isn't in your wallet protected by your secret keys, it's in the exchange's wallet. Putting your Bitcoin onto an exchange puts you in the same situation as putting your dollars in a bank.
If you keep your Bitcoin in your own wallet and you keep the keys secret then nobody, not the courts, not the government, not the taxman, not your ex-wife can get at it without getting their hands on the private key. If it;s in a bank they'll get a court order and you are stuffed.
> I can do that with pounds.
You can ask a bank nicely to do it for you and they'll charge you a packet, give you a sh*tty exchange rate and make you wait and track the whole thing and report it to government and if they don't like what they think you are doing they'll freeze the payment or shut your account. Which is inconvenient if you are a US citizen and want to bet on sports or play poker for money online or a South Korean citizen with currency controls stopping them spending money abroad or, admittedly, a bunch of less pleasant things.
Bitcoin isn't the best of the crypto currencies for paying for goods but with Ethereum you just bring up an app on your PC type in the address you want to send it and in ten minutes it's done for a tiny fee.
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In reply to no_more_scotch_eggs:
Only a fool would bet that Bitcoin will NOT break $20k in 2018. It could go MUCH higher over the next decade.
Only a fool would bet that Bitcoin will NOT break $20k in 2018. It could go MUCH higher over the next decade.
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In reply to Shani:
Yes and by June it could be £2k. It's a lottery currency driven only by sentiment.
> Only a fool would bet that Bitcoin will NOT break $20k in 2018. It could go MUCH higher over the next decade.
Yes and by June it could be £2k. It's a lottery currency driven only by sentiment.
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In reply to balmybaldwin:
From what I understand there aren't enough PCs mining Bitcoin at the moment to complete the vast number of transactions taking place, now people are starting to use the currency more. Transaction fees have rocketed;
https://bitinfocharts.com/comparison/bitcoin-transactionfees.html
This could account for some if not most of the crash. People wanting to move small amounts of coin are having to pay 30 Euros plus in fees.
From what I understand there aren't enough PCs mining Bitcoin at the moment to complete the vast number of transactions taking place, now people are starting to use the currency more. Transaction fees have rocketed;
https://bitinfocharts.com/comparison/bitcoin-transactionfees.html
This could account for some if not most of the crash. People wanting to move small amounts of coin are having to pay 30 Euros plus in fees.
In reply to Pete Dangerous:
Isn't that just a logical stage in the transition from geek Monopoly money to widely tradeable asset. It costs me £30 to pay GBP bills out of my offshore accounts (so I don't, but that's not the point).
> From what I understand there aren't enough PCs mining Bitcoin at the moment to complete the vast number of transactions taking place, now people are starting to use the currency more. Transaction fees have rocketed;
> This could account for some if not most of the crash. People wanting to move small amounts of coin are having to pay 30 Euros plus in fees.
Isn't that just a logical stage in the transition from geek Monopoly money to widely tradeable asset. It costs me £30 to pay GBP bills out of my offshore accounts (so I don't, but that's not the point).
In reply to BnB:
Maybe, but two months ago it was a fraction of the cost is is now. What was very accessible is now becoming more exclusive to those who are using it for large tranactions.
Maybe, but two months ago it was a fraction of the cost is is now. What was very accessible is now becoming more exclusive to those who are using it for large tranactions.
In reply to Pete Dangerous:
While exchanges that offer bitcoin wallets remain countable on the fingers of one hand, the transaction costs will rise until they find a limit, then steadily fall as competition proliferates. Or the crazy bubble just bursts.
Yesterday's crash is explained by a big holder of the asset cashing out. I don't think transaction charges are a worry to people who have bought for the potential appreciation, not the flexibility.
While exchanges that offer bitcoin wallets remain countable on the fingers of one hand, the transaction costs will rise until they find a limit, then steadily fall as competition proliferates. Or the crazy bubble just bursts.
Yesterday's crash is explained by a big holder of the asset cashing out. I don't think transaction charges are a worry to people who have bought for the potential appreciation, not the flexibility.
In reply to Shani:
Really surprised that you're so completely convinced. My advisors are seriously wary.
> Only a fool would bet that Bitcoin will NOT break $20k in 2018. It could go MUCH higher over the next decade.
Really surprised that you're so completely convinced. My advisors are seriously wary.
In reply to BnB:
But how many people who own Btc have bought it to hold and appreciate compared to those who were using it for small transactions last year? If no ones actually buying anything with it because the charges are so high, what's the actual point of it?
I'm guessing offshore fees are high because people who use offshore accounts have a decent bit of cash and they can afford to pay it. I don't know how fees are set with Btc but I did read the rise was due to not enough machines were mining to complete the transactions.
I read a few weeks back that there would be a dip after the currency was launched on future markets but don't know enough about it to understand why.
But how many people who own Btc have bought it to hold and appreciate compared to those who were using it for small transactions last year? If no ones actually buying anything with it because the charges are so high, what's the actual point of it?
I'm guessing offshore fees are high because people who use offshore accounts have a decent bit of cash and they can afford to pay it. I don't know how fees are set with Btc but I did read the rise was due to not enough machines were mining to complete the transactions.
I read a few weeks back that there would be a dip after the currency was launched on future markets but don't know enough about it to understand why.
Post edited at 16:54
In reply to balmybaldwin:
Yesterday's crash in dollar value has just about recovered now. It's currently +30% on 24hrs ago and equal to the all-time-high prior to 8th Dec 2017. Transactions are processing fine today.
The fees are too high and the transaction speed too slow for bitcoin (BTC) to be adopted as a widely used tool for small transactions. As a bulk store of value and for large purchases - the limited supply and mathematically incorruptible ledger are pretty good. The dollar value may change on a short term basis, but the general trend is only going one way.
There are plenty of other coins coming on board (Litecoin LTC etc.) that will handle all the small transactions that will really challenge the traditional banking fee model (VISA/Mastercard etc.). The fees are only going into the blockchain generation process. No longer will consumers and merchants be propping up these massive banking corporations with a huge slice of the transaction value.
Yesterday's crash in dollar value has just about recovered now. It's currently +30% on 24hrs ago and equal to the all-time-high prior to 8th Dec 2017. Transactions are processing fine today.
The fees are too high and the transaction speed too slow for bitcoin (BTC) to be adopted as a widely used tool for small transactions. As a bulk store of value and for large purchases - the limited supply and mathematically incorruptible ledger are pretty good. The dollar value may change on a short term basis, but the general trend is only going one way.
There are plenty of other coins coming on board (Litecoin LTC etc.) that will handle all the small transactions that will really challenge the traditional banking fee model (VISA/Mastercard etc.). The fees are only going into the blockchain generation process. No longer will consumers and merchants be propping up these massive banking corporations with a huge slice of the transaction value.
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In reply to BnB:
My position is more nuanced; it's a new technology - a game-changer/paradigm shift, and so no one knows what it is worth.
There are clearly going to be 'tree shakes' and profit taking as professional speculators lock in returns for the year.
But with my IT head screwed on, i guarantee that crypto currencies are going to grow massively over the coming decade, and Bitcoin has prime-mover advantage.
Your advisors will have way more financial investment knowledge than me, but with cryptocurrencies they're little more use than astrologers. It's a technology entity we're dealing with here!
> Really surprised that you're so completely convinced. My advisors are seriously wary.
My position is more nuanced; it's a new technology - a game-changer/paradigm shift, and so no one knows what it is worth.
There are clearly going to be 'tree shakes' and profit taking as professional speculators lock in returns for the year.
But with my IT head screwed on, i guarantee that crypto currencies are going to grow massively over the coming decade, and Bitcoin has prime-mover advantage.
Your advisors will have way more financial investment knowledge than me, but with cryptocurrencies they're little more use than astrologers. It's a technology entity we're dealing with here!
In reply to Shani:
Would one be right in thinking that, in the long term, it must be that one of these currencies (at most) comes to dominate and all the others will go to zero and stop being used?
In which case, which one?
Would one be right in thinking that, in the long term, it must be that one of these currencies (at most) comes to dominate and all the others will go to zero and stop being used?
In which case, which one?
In reply to Coel Hellier:
That's the logic that strikes me. If I knew which one I'd already own a slice. As would all the institutions. But they don't, nor do they believe. At least not yet.
> Would one be right in thinking that, in the long term, it must be that one of these currencies (at most) comes to dominate and all the others will go to zero and stop being used?
> In which case, which one?
That's the logic that strikes me. If I knew which one I'd already own a slice. As would all the institutions. But they don't, nor do they believe. At least not yet.
In reply to Coel Hellier:
A very good question - and perhaps one that reaches deep in to economics rather than IT. Short answer is i don't know/i could be wrong.
That being said, there is no (technical) reason why many cryptocurrencies couldn't exist. There could emerge regional cryptocurrencies (several UK cities already have local currencies, such as Bristol), whilst large firms might find it tax efficient to use a bespoke cryptocurrency between them (for example if Apple and Microsoft wanted to collaborate on projects).
As people and organisations become hyperwealthy, the disposable income and desire to invest and diversify risk across currencies may well drive the emergence of many new cryptocurrencies.
But we could also see a faster turnover (rise and collapse) of currencies - not just crypto but ALL currencies! There will be jostling and instability - and this pattern may roll on in a continual cycle.
This again takes us back to trying to understand what money is, what function it performs, and what function its new cryptocurrency form it CAN now perform.
It's not just IT that is causing this turmoil, but also massive inequality which means bubbles are unavoidable as uber-wealthy investors search parasitically for a return in anything that looks like it might provide a positive return.
China runs a massive surplus of dollars and as such is wagged by US interest rates and inflation. The lack of control unsettles them and is a source of friction. (That kind of power loss is avoided in decentralised cryptocurrencies).
I wonder if inequality can reach a point where 'money' as we know it may be becoming worthless? Really we just need some way to capture skill/effort/value and trade directly with another.
> Would one be right in thinking that, in the long term, it must be that one of these currencies (at most) comes to dominate and all the others will go to zero and stop being used?
> In which case, which one?
A very good question - and perhaps one that reaches deep in to economics rather than IT. Short answer is i don't know/i could be wrong.
That being said, there is no (technical) reason why many cryptocurrencies couldn't exist. There could emerge regional cryptocurrencies (several UK cities already have local currencies, such as Bristol), whilst large firms might find it tax efficient to use a bespoke cryptocurrency between them (for example if Apple and Microsoft wanted to collaborate on projects).
As people and organisations become hyperwealthy, the disposable income and desire to invest and diversify risk across currencies may well drive the emergence of many new cryptocurrencies.
But we could also see a faster turnover (rise and collapse) of currencies - not just crypto but ALL currencies! There will be jostling and instability - and this pattern may roll on in a continual cycle.
This again takes us back to trying to understand what money is, what function it performs, and what function its new cryptocurrency form it CAN now perform.
It's not just IT that is causing this turmoil, but also massive inequality which means bubbles are unavoidable as uber-wealthy investors search parasitically for a return in anything that looks like it might provide a positive return.
China runs a massive surplus of dollars and as such is wagged by US interest rates and inflation. The lack of control unsettles them and is a source of friction. (That kind of power loss is avoided in decentralised cryptocurrencies).
I wonder if inequality can reach a point where 'money' as we know it may be becoming worthless? Really we just need some way to capture skill/effort/value and trade directly with another.
Post edited at 22:18
In reply to Shani:
Except that history of money is itself strictly for the birds. Barter systems most likely come way after informal credit systems. Nothing - not even your gold standard has intrinsic value. So then not even Bitcoin with its set number of tokens. It's the ledger and decentralised bit that's central to the concept not 'limited number of bitcoins' that's important.
Non inflationary money, yeah whatever.
D
Except that history of money is itself strictly for the birds. Barter systems most likely come way after informal credit systems. Nothing - not even your gold standard has intrinsic value. So then not even Bitcoin with its set number of tokens. It's the ledger and decentralised bit that's central to the concept not 'limited number of bitcoins' that's important.
Non inflationary money, yeah whatever.
D
In reply to BnB:
"That's the logic that strikes me. If I knew which one I'd already own a slice. As would all the institutions. But they don't, nor do they believe. At least not yet."
Which is why carpet bagging is probably a good strategy (if there wasn't over a thousand coins). But sticking something in Bitcoin, bitcoin cash, lite coin, ethereal, ripple, IOTA is probably sensible. Trouble is they could all fail and one of the thousand others rises to the top ...
"That's the logic that strikes me. If I knew which one I'd already own a slice. As would all the institutions. But they don't, nor do they believe. At least not yet."
Which is why carpet bagging is probably a good strategy (if there wasn't over a thousand coins). But sticking something in Bitcoin, bitcoin cash, lite coin, ethereal, ripple, IOTA is probably sensible. Trouble is they could all fail and one of the thousand others rises to the top ...
In reply to Shani:
While there are always exceptions, the beneficiaries of Bitcoin's astronomic rise to date are anyone but the financial institutions or sophisticated investors. It's a bubble already without their involvement.
When the world gets more comfortable with blockchain that looks set to change and the first of your paragraphs quoted may look prescient.
> As people and organisations become hyperwealthy, the disposable income and desire to invest and diversify risk across currencies may well drive the emergence of many new cryptocurrencies.
> It's not just IT that is causing this turmoil, but also massive inequality which means bubbles are unavoidable as uber-wealthy investors search parasitically for a return in anything that looks like it might provide a positive return.
While there are always exceptions, the beneficiaries of Bitcoin's astronomic rise to date are anyone but the financial institutions or sophisticated investors. It's a bubble already without their involvement.
When the world gets more comfortable with blockchain that looks set to change and the first of your paragraphs quoted may look prescient.
In reply to balmybaldwin:
I think the main change out of the latest crash is that Bitcoin's market dominance has gone down.
My prediction for 2018 is Bitcoin Cash overtaking Bitcoin. Bitcoin Cash still isn't capable of handling transactions on a global scale though.
Bitcoin can do 7 transactions/second and the developers are adamant they're not going to change the underlying code that enforces that limit. It currently costs ~$35 to send any amount of Bitcoin which is outrageous.
Ripple is the only coin in the top five at the moment that can handle any decent volume at 1,500 transactions per second. The transaction confirmation time is also 3 seconds vs Bitcoin's 1 hour at best! Dash is also promising as it can scale it's transactions per second on the fly to levels far exceeding what VISA's network does at the mo which is 24,000/s.
If you're buying crypto as an investment. Buy some Bitcoin and then switch it to an alt coin on an exchange.
Everyone talks about Bitcoin because they see this high $ increase and go wow ie. $1,000 to $20,000 in year. $19,000 is a lot of money. Ethereum has gone from $8 to $800 though. Although a $792 increase isn't as attention grabbing as a $19,000 increase in the headlines, what would you sooner have, a 2,000% increase or a 10,000% increase?
PS. I've used the highs before the recent crash in the last paragraph as it's easier to visualise. The ratios are still pretty much the same but Bitcoin is around 1,500% today and Eth's 9,400%
In reply to BnB:
Perhaps I’m being myopic but I don’t think any of the extant cryptocurrencies will end up an important force in international finance. If the technology proves to be superior then it will be replicated by the same old global players and gatekeepers. They can’t afford to loose control of the mechanisms underpinning it all, and they can easily afford to replicate a new operating model and they have the regulatory/political clout to maintain their monopolistic positions.
The Wild West was a very short lived era. I think we’re in a similar period with cryptocurrencies. There are fortunes to be made and lost, and some of the new rich will merge into The System and others will move on to pastures new.
My problem with cryprocurrencies is the inherent energy cost associated with their mechanisms.
> That's the logic that strikes me. If I knew which one I'd already own a slice. As would all the institutions. But they don't, nor do they believe. At least not yet.
Perhaps I’m being myopic but I don’t think any of the extant cryptocurrencies will end up an important force in international finance. If the technology proves to be superior then it will be replicated by the same old global players and gatekeepers. They can’t afford to loose control of the mechanisms underpinning it all, and they can easily afford to replicate a new operating model and they have the regulatory/political clout to maintain their monopolistic positions.
The Wild West was a very short lived era. I think we’re in a similar period with cryptocurrencies. There are fortunes to be made and lost, and some of the new rich will merge into The System and others will move on to pastures new.
My problem with cryprocurrencies is the inherent energy cost associated with their mechanisms.
Post edited at 10:53
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In reply to wintertree:
> My problem with cryprocurrencies is the inherent energy cost associated with their mechanisms.
Banks don't use power?
In reply to wintertree:
This isn't a problem across all cryptocurrencies. There are different implementations that are not premised on energy consumption as a brake on mining.
> My problem with cryprocurrencies is the inherent energy cost associated with their mechanisms.
This isn't a problem across all cryptocurrencies. There are different implementations that are not premised on energy consumption as a brake on mining.
In reply to Bjartur i Sumarhus:
The only ones on that list I'd buy and forget about for a few months would be Bitcoin and Ethereum, maybe Litecoin but you may as well buy Bitcoin since they are almost the same thing. Litecoin is the same code as Bitcoin with a couple of constants tweaked.
IOTA is way more risky than the others. It's really early stage and at present is basically a pump and dump plaything. If you get into that you want to have a stop loss order under it, it's not one to buy and forget about.
Ripple is interesting technically and of the alts the one whose price is least correlated to Bitcoin BUT the Ripple company business model isn't really dependent on the coin price appreciating. As I understand it they are trying to sell their technology to banks but the banks don't need to use the publicly traded Ripple token, they can have an internal token.
Bcash I personally wouldn't touch with a bargepole because Roger Ver is a convicted felon and I don't think anyone is going to get rich off BCH except Roger Ver and his friends. They are the ones running the pump-and-dump scheme which controls its price, everybody else is along for the ride. But this Bitcoin/BCash divide is a very politicised issue and lots of people are on the other side of the fence.
> Which is why carpet bagging is probably a good strategy (if there wasn't over a thousand coins). But sticking something in Bitcoin, bitcoin cash, lite coin, ethereal, ripple, IOTA is probably sensible. Trouble is they could all fail and one of the thousand others rises to the top ...
The only ones on that list I'd buy and forget about for a few months would be Bitcoin and Ethereum, maybe Litecoin but you may as well buy Bitcoin since they are almost the same thing. Litecoin is the same code as Bitcoin with a couple of constants tweaked.
IOTA is way more risky than the others. It's really early stage and at present is basically a pump and dump plaything. If you get into that you want to have a stop loss order under it, it's not one to buy and forget about.
Ripple is interesting technically and of the alts the one whose price is least correlated to Bitcoin BUT the Ripple company business model isn't really dependent on the coin price appreciating. As I understand it they are trying to sell their technology to banks but the banks don't need to use the publicly traded Ripple token, they can have an internal token.
Bcash I personally wouldn't touch with a bargepole because Roger Ver is a convicted felon and I don't think anyone is going to get rich off BCH except Roger Ver and his friends. They are the ones running the pump-and-dump scheme which controls its price, everybody else is along for the ride. But this Bitcoin/BCash divide is a very politicised issue and lots of people are on the other side of the fence.
In reply to Shani:
With regard to bespoke cryptocurrencies: http://m.scmp.com/tech/enterprises/article/2125770/obike-singapore-launch-c...
> That being said, there is no (technical) reason why many cryptocurrencies couldn't exist. There could emerge regional cryptocurrencies (several UK cities already have local currencies, such as Bristol), whilst large firms might find it tax efficient to use a bespoke cryptocurrency between them (for example if Apple and Microsoft wanted to collaborate on projects).
With regard to bespoke cryptocurrencies: http://m.scmp.com/tech/enterprises/article/2125770/obike-singapore-launch-c...
In reply to tom_in_edinburgh:
Just suppose one were foolish enough to want to have a small-ish flutter on Ripple. What's the easiest way of doing so?
Just suppose one were foolish enough to want to have a small-ish flutter on Ripple. What's the easiest way of doing so?
In reply to Coel Hellier:
To tell you the truth I don't know. I've never bought crypto for fiat money, I've been mining Ethereum on a really small scale and trading the results. The exchanges I use and could recommend are crypto-to-crypto.
A lot of the obvious places to buy crypto for fiat aren't taking new accounts at the moment because they've been swamped due to the press coverage and possibly people opening lots of accounts to get round limits on withdrawals.
I think Ripple is going to be time sensitive so any path which makes you wait for a deposit to clear to get the coins may be too late to get in on the pump. Apparently there are rumours of Coinbase making it one of the three or four coins you can buy directly which would be very positive for it but may or may not be true. It is up 10x in a couple of weeks on nothing but rumour, it may go higher first but is likely to go straight back down again very fast. The chart speaks for itself.
https://poloniex.com/exchange#usdt_xrp
> Just suppose one were foolish enough to want to have a small-ish flutter on Ripple. What's the easiest way of doing so?
To tell you the truth I don't know. I've never bought crypto for fiat money, I've been mining Ethereum on a really small scale and trading the results. The exchanges I use and could recommend are crypto-to-crypto.
A lot of the obvious places to buy crypto for fiat aren't taking new accounts at the moment because they've been swamped due to the press coverage and possibly people opening lots of accounts to get round limits on withdrawals.
I think Ripple is going to be time sensitive so any path which makes you wait for a deposit to clear to get the coins may be too late to get in on the pump. Apparently there are rumours of Coinbase making it one of the three or four coins you can buy directly which would be very positive for it but may or may not be true. It is up 10x in a couple of weeks on nothing but rumour, it may go higher first but is likely to go straight back down again very fast. The chart speaks for itself.
https://poloniex.com/exchange#usdt_xrp
Post edited at 22:01
BTC seems to be on a downward trend now. Any guesses why that is? Have people lost 'faith' in it after all the speculation of the bubble bursting? My £200 gamble peaked at £380 in a few weeks, but is now closer to £200 again. Decision point!
In reply to NottsRich:
Bitcoin is just being bitcoin, it is just following the normal pattern of a correction after an excessive run up. Zoom out: look at the chart for the last couple of years to get some context on this month.
There's a couple of things happening, first US tax season and after a 10x run up in 2017 there will be a bunch of BTC traders taking money out to pay tax bills at the start of January. Also there is a cycle where money flows from BTC into alt coins when BTC stops running up fast and a few months later the money returns to BTC. At the moment there are some absolutely mental run ups in alts like Ripple which will be draining traders money out of BTC. The normal pattern is for the alts to come crashing down and money to flow back to BTC.
> BTC seems to be on a downward trend now. Any guesses why that is? Have people lost 'faith' in it after all the speculation of the bubble bursting? My £200 gamble peaked at £380 in a few weeks, but is now closer to £200 again. Decision point!
Bitcoin is just being bitcoin, it is just following the normal pattern of a correction after an excessive run up. Zoom out: look at the chart for the last couple of years to get some context on this month.
There's a couple of things happening, first US tax season and after a 10x run up in 2017 there will be a bunch of BTC traders taking money out to pay tax bills at the start of January. Also there is a cycle where money flows from BTC into alt coins when BTC stops running up fast and a few months later the money returns to BTC. At the moment there are some absolutely mental run ups in alts like Ripple which will be draining traders money out of BTC. The normal pattern is for the alts to come crashing down and money to flow back to BTC.
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In reply to NottsRich:
I'd register with an exchange and convert it to something else tbh - Bittrex.com is good.
I bought (ie. swapped Bitcoin for) a load of Stellar at $0.08/coin a couple of months ago and it's just boomed to $0.35/coin the this week. Got Ripple at $1 and that's $2.45. You're not gonna get that return on Bitcoin in such a short timeframe.
This site is good for seeing what coins are doing well at the mo - coinmarketcap.com
I think I'd be tempted to wait for Bitcoin to bounce back to ~$15k before making the swap to get more bang for your buck.
I think Bitcoin's market dominance is wavering as it really can't keep up with the demand. I've seen transactions fees as high as $60 for Bitcoin and it can take hours for it to go though. Bitcoin can only handle 7 transaction/second globally! Ripple takes seconds and currently costs ~$0.03 for a transaction.
In reply to Coel Hellier:
If you don't have any cryptocurrency I think the easiest way to get some is https://blockchain.info. I've used Coinbase in the last month and it was terrible! I'd buy either Ether or Bitcoin Cash as it'll be cheaper and faster to send that to an exchange to get some alt coins. I'd recommend Bittrex.com for that.
In reply to Coel Hellier:
I hope you were foolish enough to get in for your flutter on in time! Ripple has now significantly overtaken Ethereum as the no2 coin in the crypto market - current market cap 60% of bitcoin which is a pretty impressive change from 3 weeks ago!
I hope you were foolish enough to get in for your flutter on in time! Ripple has now significantly overtaken Ethereum as the no2 coin in the crypto market - current market cap 60% of bitcoin which is a pretty impressive change from 3 weeks ago!
In reply to MarkM:
The trick with Ripple isn't the getting in, it is knowing when to get out.
> I hope you were foolish enough to get in for your flutter on in time! Ripple has now significantly overtaken Ethereum as the no2 coin in the crypto market - current market cap 60% of bitcoin which is a pretty impressive change from 3 weeks ago!
The trick with Ripple isn't the getting in, it is knowing when to get out.
2
In reply to tom_in_edinburgh:
How are you supposed to know which crypto to buy? I'm keen to do so but no idea which ones to go for.
How are you supposed to know which crypto to buy? I'm keen to do so but no idea which ones to go for.
In reply to Tyler:
This kind of advice is always really risky to give.... the state of the market now is that the Alt coins are extremely pumped and Bitcoin is low but recovering weakly. Historically, the next move would be for the cycle to turn and Bitcoin to rise as the alt coins either crash spectacularly (in the case of the ones which are pumped to a ridiculous degree) or bleed out slowly. The trick is to know when this will happen, things like XRP or STR could conceivably double again before they crash. They could also crash 50% this afternoon. It's like a forest after a drought, it is obvious there will almost certainly be a huge fire but you don't know when the spark that sets it off will happen.
Bottom line: if you want to buy today and you don't want to be checking the price every 5 minutes or keeping your coin on an exchange with a stop loss under it then my advice would be buy BTC (Bitcoin). Once the alt market corrects in a month or two then sell some of it for Ethereum.
> How are you supposed to know which crypto to buy? I'm keen to do so but no idea which ones to go for.
This kind of advice is always really risky to give.... the state of the market now is that the Alt coins are extremely pumped and Bitcoin is low but recovering weakly. Historically, the next move would be for the cycle to turn and Bitcoin to rise as the alt coins either crash spectacularly (in the case of the ones which are pumped to a ridiculous degree) or bleed out slowly. The trick is to know when this will happen, things like XRP or STR could conceivably double again before they crash. They could also crash 50% this afternoon. It's like a forest after a drought, it is obvious there will almost certainly be a huge fire but you don't know when the spark that sets it off will happen.
Bottom line: if you want to buy today and you don't want to be checking the price every 5 minutes or keeping your coin on an exchange with a stop loss under it then my advice would be buy BTC (Bitcoin). Once the alt market corrects in a month or two then sell some of it for Ethereum.
In reply to tom_in_edinburgh:
Thanks Tom, what I can't seem to get my head around is how many different currencies there are and whether new ones are appearing all the time, I assume there's nothing to stop new ones appearing but have any been initiated and then just died off? Presumably all the ones you mentioned have reached some sort of critical mass which means they'll be around forever even if they don't go anywhere or are there crypto equivalents of Vine or MySpace?
Thanks Tom, what I can't seem to get my head around is how many different currencies there are and whether new ones are appearing all the time, I assume there's nothing to stop new ones appearing but have any been initiated and then just died off? Presumably all the ones you mentioned have reached some sort of critical mass which means they'll be around forever even if they don't go anywhere or are there crypto equivalents of Vine or MySpace?
In reply to Tyler:
Check out https://coinmarketcap.com/all/views/all to get an idea of the number of coins out there well over a 1000 and- more being created daily/weekly via ICOs.
Plenty of myspace equivalents already yes.. Maybe ~10% of coins or less have any long term future.
Tom's suggested the Bitcoin/Eth investment option which is pretty sound advice (and I have some of both) but as a crypto newbie I too was bewildered by the overall choice and ended up with a significant investment in top20 and top30 crypto index funds...
I'm waiting for both of these to hit exchanges this month so I can take some of my stake out as they've both done well...in a major bull market overall of course but also taking into account the big pre-Christmas dip.
Check out https://coinmarketcap.com/all/views/all to get an idea of the number of coins out there well over a 1000 and- more being created daily/weekly via ICOs.
Plenty of myspace equivalents already yes.. Maybe ~10% of coins or less have any long term future.
Tom's suggested the Bitcoin/Eth investment option which is pretty sound advice (and I have some of both) but as a crypto newbie I too was bewildered by the overall choice and ended up with a significant investment in top20 and top30 crypto index funds...
I'm waiting for both of these to hit exchanges this month so I can take some of my stake out as they've both done well...in a major bull market overall of course but also taking into account the big pre-Christmas dip.
In reply to tom_in_edinburgh:
Yes I've heard similar ..
it applies in general to most cryptocurrencies of course
Familiarity with the markets and exchanges, stop-losses etc. is something I'm only just getting to grips with!
> The trick with Ripple isn't the getting in, it is knowing when to get out.
Yes I've heard similar ..
it applies in general to most cryptocurrencies of course
Familiarity with the markets and exchanges, stop-losses etc. is something I'm only just getting to grips with!
In reply to tom_in_edinburgh:
It's knowing how to get out. When I tried to 'withdraw' £100 worth from Gatehub it was going to charge £50 withdrawal fee! So it's still in there (going up, luckily)
> The trick with Ripple isn't the getting in, it is knowing when to get out.
It's knowing how to get out. When I tried to 'withdraw' £100 worth from Gatehub it was going to charge £50 withdrawal fee! So it's still in there (going up, luckily)
In reply to Tyler:
I'm in a similar situation to you. In the end I used etoro after advice on a previous thread, and bought Ethereum, XTC and BCH. I don't really know what these things are or how they work. I invested $200 in each just before Xmas and I'm around $350 up already.
I figure if it all goes wrong I'm not going to be ruined, but if it goes right, it'll pay for my next trip to the US. Obviously if I'd invested $6000, then I'd be $3000 better off. Try those. The minimum investment is $200 BTW.
There is also a $25 withdrawal fee which (at the moment!) I don't mind.
I'm in a similar situation to you. In the end I used etoro after advice on a previous thread, and bought Ethereum, XTC and BCH. I don't really know what these things are or how they work. I invested $200 in each just before Xmas and I'm around $350 up already.
I figure if it all goes wrong I'm not going to be ruined, but if it goes right, it'll pay for my next trip to the US. Obviously if I'd invested $6000, then I'd be $3000 better off. Try those. The minimum investment is $200 BTW.
There is also a $25 withdrawal fee which (at the moment!) I don't mind.
In reply to Tyler:
Coins die off quietly. First they get delisted from the major exchanges because there's not enough volume and eventually even the minor exchanges don't list them, nobody notices the point where the last node/miner quits.
My Space was quite successful for a while: if there was a crypto equivalent of MySpace now you wouldn't know it was going to be MySpace rather than Facebook. Most of the alts are more like a 10 employee penny tech stock that you have never heard of but had a pump which gave it a ridiculous valuation for a couple of weeks in 1991.
Ripple is strange because it is an interesting medium sized tech company with actual developers (as opposed to open source) but its business of selling tech to banks is not really tied to the value of the XRP token. Banks can license Ripple's tech to move money without buying XRP tokens. Also, Ripple can issue more XRP up to a cap of something like 100 billion coins whenever it likes. It's nothing like the decentralised model of the other mainstream cryptos.
> Presumably all the ones you mentioned have reached some sort of critical mass which means they'll be around forever even if they don't go anywhere or are there crypto equivalents of Vine or MySpace?
Coins die off quietly. First they get delisted from the major exchanges because there's not enough volume and eventually even the minor exchanges don't list them, nobody notices the point where the last node/miner quits.
My Space was quite successful for a while: if there was a crypto equivalent of MySpace now you wouldn't know it was going to be MySpace rather than Facebook. Most of the alts are more like a 10 employee penny tech stock that you have never heard of but had a pump which gave it a ridiculous valuation for a couple of weeks in 1991.
Ripple is strange because it is an interesting medium sized tech company with actual developers (as opposed to open source) but its business of selling tech to banks is not really tied to the value of the XRP token. Banks can license Ripple's tech to move money without buying XRP tokens. Also, Ripple can issue more XRP up to a cap of something like 100 billion coins whenever it likes. It's nothing like the decentralised model of the other mainstream cryptos.
In reply to Alyson:
Take care not to overstretch.... if your profits are that big you owe a lot of tax (and have a major asset to chase it on). I can see a few people losing their house over this: pay off mortgage, little cash left, get big tax bill. Major profit non-declaration (on conversion back to sterling) would be criminal tax evasion with the usual penalties.
http://www.thisismoney.co.uk/money/experts/article-5019947/Do-pay-tax-sell-...
Take care not to overstretch.... if your profits are that big you owe a lot of tax (and have a major asset to chase it on). I can see a few people losing their house over this: pay off mortgage, little cash left, get big tax bill. Major profit non-declaration (on conversion back to sterling) would be criminal tax evasion with the usual penalties.
http://www.thisismoney.co.uk/money/experts/article-5019947/Do-pay-tax-sell-...
Post edited at 08:29
In reply to Offwidth:
Wouldn’t the last stage be “oh bugger, get new mortgage “, rather than lose a house?
> Take care not to overstretch.... if your profits are that big you owe a lot of tax (and have a major asset to chase it on). I can see a few people losing their house over this: pay off morgage, little cash left, get big tax bill.
Wouldn’t the last stage be “oh bugger, get new mortgage “, rather than lose a house?
1
In reply to MG:
I guess it depends on your ability to do that in such tricky circumstances. It's happened in the past where ignorant people failed to realise their undeclared profits had tax liabilities and they were overstretched when HMRC caught up with them with a tax bill and fines and/or possibilities of criminal liability. It's a worst case scenario of a lot of possible negative scenarios. My main point is anyone capable of paying off a large lump off their mortgage with bitcoin profits is almost certainly owing a lot of tax and they need to declare that and retain enough liquidity to pay it conveniently.
I guess it depends on your ability to do that in such tricky circumstances. It's happened in the past where ignorant people failed to realise their undeclared profits had tax liabilities and they were overstretched when HMRC caught up with them with a tax bill and fines and/or possibilities of criminal liability. It's a worst case scenario of a lot of possible negative scenarios. My main point is anyone capable of paying off a large lump off their mortgage with bitcoin profits is almost certainly owing a lot of tax and they need to declare that and retain enough liquidity to pay it conveniently.
Post edited at 09:00
In reply to Offwidth:
That's a very sensible warning but I wouldn't sound too loud an alarm.
The tax owed can't be more than 20% x (the total proceeds realised into GBP - the original purchase price). So a initial investment of £1k that realises a final figure of £11k shows a gain of £10k on which only £2k is due in tax.
But with the annual CGT allowance in the region of £11k it's unlikely small investors will end up paying tax at all.
The no tax outcome is far more likely however because these are pumped stocks and the prices are artificially elevated. Many will lose their whole stake.
That's a very sensible warning but I wouldn't sound too loud an alarm.
The tax owed can't be more than 20% x (the total proceeds realised into GBP - the original purchase price). So a initial investment of £1k that realises a final figure of £11k shows a gain of £10k on which only £2k is due in tax.
But with the annual CGT allowance in the region of £11k it's unlikely small investors will end up paying tax at all.
The no tax outcome is far more likely however because these are pumped stocks and the prices are artificially elevated. Many will lose their whole stake.
Post edited at 13:03
2
In reply to BnB:
Some people inexperienced with dealing with such tax arrangements have made a lot more than 11k and you are forgetting the fines and the other complications if the revenue are treating you as a potential tax evader. In the past it was things like selling 2nd properties with big increases in value where people got 'stung' (tax is hardly ever mentioned in these greed inducing TV shows about how much money you could make on buying and selling houses).
Some people inexperienced with dealing with such tax arrangements have made a lot more than 11k and you are forgetting the fines and the other complications if the revenue are treating you as a potential tax evader. In the past it was things like selling 2nd properties with big increases in value where people got 'stung' (tax is hardly ever mentioned in these greed inducing TV shows about how much money you could make on buying and selling houses).
Post edited at 15:27
1
In reply to Offwidth:
You are right to point out tax may be due but HMRC won't be draconian if it was genuine mistake, or lack of knowledge
https://www.gov.uk/hmrc-internal-manuals/compliance-handbook/ch81140
Of course if it's deliberate that's another matter, but then I doubt fraudsters are too bothered about UKC advice.
You are right to point out tax may be due but HMRC won't be draconian if it was genuine mistake, or lack of knowledge
https://www.gov.uk/hmrc-internal-manuals/compliance-handbook/ch81140
Of course if it's deliberate that's another matter, but then I doubt fraudsters are too bothered about UKC advice.
In reply to Tyler:
I got this advice from another forum:
write the name of 20 random coins on bits of paper, attach these to a dart board, 1 per number. get 3 darts, toss darts, buy the selected coins.
> How are you supposed to know which crypto to buy? I'm keen to do so but no idea which ones to go for.
I got this advice from another forum:
write the name of 20 random coins on bits of paper, attach these to a dart board, 1 per number. get 3 darts, toss darts, buy the selected coins.
1
In reply to MG
As far as I'm aware failue to declare significant taxable capital gains is not normally regarded as a careless inaccuracy and I don't think that document intends to cover lack of basic knowledge of this. If in doubt people should be contacting an independant adviser or the revenue.
As far as I'm aware failue to declare significant taxable capital gains is not normally regarded as a careless inaccuracy and I don't think that document intends to cover lack of basic knowledge of this. If in doubt people should be contacting an independant adviser or the revenue.
1
In reply to Blunderbuss:
This is excellent advice if you also own a time machine and are able to do it last month. Today, not so much.
> write the name of 20 random coins on bits of paper, attach these to a dart board, 1 per number. get 3 darts, toss darts, buy the selected coins.
This is excellent advice if you also own a time machine and are able to do it last month. Today, not so much.
In reply to Offwidth:
If you know enough to contact an adviser, it's not careless. But if you don't and I willing to bet quite a few bitcoin winners have never given capital gains tax as second thought, I'd say it is. Reading that document, I'd say HMRC agree.
> In reply to MG
> As far as I'm aware failue to declare significant taxable capital gains is not normally regarded as a careless inaccuracy and I don't think that document intends to cover lack of basic knowledge of this. If in doubt people should be contacting an independant adviser or the revenue.
If you know enough to contact an adviser, it's not careless. But if you don't and I willing to bet quite a few bitcoin winners have never given capital gains tax as second thought, I'd say it is. Reading that document, I'd say HMRC agree.
1
In reply to MG:
There are examples of people jailed and asset recovery made on CGT evasion on house sales. If the owners thought they were due kinder treatment surely they would have settled out of court.
There are examples of people jailed and asset recovery made on CGT evasion on house sales. If the owners thought they were due kinder treatment surely they would have settled out of court.
In reply to Offwidth:
Of course. But you were Cassandra-ing over house repossessions for the lucky winners who had used their superlative proceeds from Bitcoin to pay off their mortgage when, even after tax, over 80% of the proceeds remain theirs to keep. As someone else mentioned, you could just remortgage for what would be about 10% of your your full house value if you'd invested the lot in bricks and mortar.
Again, I'm not criticising what in general was a very sensible bit of advice. And you're surely correct that a high proportion of Bitcoin investors are completely ignorant of their obligations to HMRC regarding capital gains, for which omission, ignorance is not an excuse. I'm also mindful of the fact that people are prone to invest surprise windfalls in hookers and coke. Or even waste it.
> Some people inexperienced with dealing with such tax arrangements have made a lot more than 11k and you are forgetting the fines and the other complications if the revenue are treating you as a potential tax evader. In the past it was things like selling 2nd properties with big increases in value where people got 'stung' (tax is hardly ever mentioned in these greed inducing TV shows about how much money you could make on buying and selling houses).
Of course. But you were Cassandra-ing over house repossessions for the lucky winners who had used their superlative proceeds from Bitcoin to pay off their mortgage when, even after tax, over 80% of the proceeds remain theirs to keep. As someone else mentioned, you could just remortgage for what would be about 10% of your your full house value if you'd invested the lot in bricks and mortar.
Again, I'm not criticising what in general was a very sensible bit of advice. And you're surely correct that a high proportion of Bitcoin investors are completely ignorant of their obligations to HMRC regarding capital gains, for which omission, ignorance is not an excuse. I'm also mindful of the fact that people are prone to invest surprise windfalls in hookers and coke. Or even waste it.
Post edited at 17:58
In reply to BnB:
I wasn't playing Cassandra I was pointing out the worse case of bad outcomes if the revenue are pursuing evasion; based on real cases in house sale CGT evasion (ignorance could also be argued there). I really think you will struggle to remortgage if the revenue are prosecuting for a significant sum and you have no liquid assets... quick sale at a big loss is more likely (as per the asset recovery in criminal cases of CGT evasion). I'd be a multimillionaire now if I'd invested a few hundred quid when first advised by a pal in the know... some must have taken that risk and transferred significant assets out and some of those must have been tempted to avoid CGT in the same adjudged to be dishonest way as those prosecuted on house sales did (in the most famous case the guy jailed for evading about 150k was arrested at the airport when he arrived back in the UK and he faced forced asset sales).
This was the 2013 warning in house sales:
https://www.theguardian.com/money/2013/mar/05/hmrc-tax-crackdown-second-hom...
I wasn't playing Cassandra I was pointing out the worse case of bad outcomes if the revenue are pursuing evasion; based on real cases in house sale CGT evasion (ignorance could also be argued there). I really think you will struggle to remortgage if the revenue are prosecuting for a significant sum and you have no liquid assets... quick sale at a big loss is more likely (as per the asset recovery in criminal cases of CGT evasion). I'd be a multimillionaire now if I'd invested a few hundred quid when first advised by a pal in the know... some must have taken that risk and transferred significant assets out and some of those must have been tempted to avoid CGT in the same adjudged to be dishonest way as those prosecuted on house sales did (in the most famous case the guy jailed for evading about 150k was arrested at the airport when he arrived back in the UK and he faced forced asset sales).
This was the 2013 warning in house sales:
https://www.theguardian.com/money/2013/mar/05/hmrc-tax-crackdown-second-hom...
Post edited at 18:22
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