I’ve invested in Bitcoin – it’s been a...

BinkyStottom wrote: »

I don't understand why you no-coiners are so argumentative when it comes to crypto currencies.

This is a new opportunity for everyone. Wouldn't you have loved to have invested in Apple or Google or Amazon back when they were just starting out? This is just that! This is the new internet, these are the new Apple, the new Google, the new Amazon.

Years ago, you couldn't give away stock in Google because people didn't understand! It wasn't something you could touch, it was an algorithm and people couldn't wrap their heads around it.

You owe it to yourself to understand, you will be left behind and you will regret it.

This is also nonsense. Yes, people would love to go back in time and buy Google stock when it was really cheap, but what people forget is how much money was lost in IT shares almost 20 years ago. Buying the wrong stock (Ask Jeeves, AltaVista, etc) could mean that you suffered 100% losses, and even diversifying wouldn't have been much help because there were so many tech companies to choose from and the vast majority of them bubbled and crashed to nothing.

People back then were undoubtedly saying much the same as you, i.e. "you don't want to miss out / be left behind" or "if I buy enough of these companies, eventually I'll be super rich". The difference is that those companies - or at least the ones that had even a chance of success - had a business plan, some means of generating cash on behalf of investors. The only thing most cryptocurrencies have as a means of appreciating capital is the hope that someone somewhere will buy your coins from you at some point in future for more than you are paying for them now. Essentially you're buying an empty box, albeit an empty box that has some interesting trading methods and underlying technology.

I'm still yet to meet a cryptocurrency investment expert that can actually offer a decent method of pricing a crypto coin against a real currency, a real commodity or even another cryptocurrency with anything that looks even remotely like a fundamental calculation of value.

The comparison to tulip mania is mostly valid. The difference is that more people can be sucked into the fad because of the internet than they could back in medieval Holland.

onomatopoeia99 wrote: »

So does this also apply if I regularly buy and sell equities within my S&S ISA and make a profit? Or if I do the same in a non-ISA dealing account and make a profit?

I want to be absolutely clear on if / when profiting from traditional investment vehicle becomes "carrying on a trade".

I've never actually encountered anyone falling into that category when starting from a private investor status, and it would likely be a question better put to an accountant than me. My general understanding is that if the majority of your working week is spent tracking markets, looking for opportunities, and then trading those opportunities, you would likely end up liable to income tax rather than CGT. It's quite a challenge!

Reading back on my point, the unlikelyhood of accidentally being subject to income tax wasn't adequately stated. To clarify: I don't think it's likely at all unless you are literally quitting your day job to trade cryptocurrencies, shares, etc.

Unhelpful HMRC guidance is available here:

https://www.gov.uk/hmrc-internal-manuals/capital-gains-manual/cg10260

BinkyStottom wrote: »

I don't understand why you no-coiners are so argumentative when it comes to crypto currencies.

This is a new opportunity for everyone. Wouldn't you have loved to have invested in Apple or Google or Amazon back when they were just starting out? This is just that! This is the new internet, these are the new Apple, the new Google, the new Amazon.

This reminds me very much of the Dot Com boom and bust.

* Investors threw money at Dot Coms regardless of whether they had a solid business case or not.
* Much nonsense was spouted by "experts" eg Profits don't matter, it's a new paradigm. Instead people invested just because the stocks were going up.
* Almost all of them failed. A tiny number survived at more realistic valuations and went on to grow.

With hindsight I predict all the above will be said about crypto in time.

Some of the platforms may survive (eg Ripple, Etherium?) and become genuinely useful, but it does not follow that the ridiculous valuations of the crypto currencies will be continue once the hype is over.

Quite possibly it will take a new platform with a new stable coin designed to eliminate speculation before it finally comes of age.

BinkyStottom wrote: »

A real currency? What makes it real exactly? That you can hold it? That it's backed by a government?

That you can legally settle debts using the currency. In other words, it is legal tender somewhere.

The fact that any government can (and does) print "real" money out of thin air doesn't set alarm bells ringing?

No.

You may be an independant financial advisor but an expert on crypto tax you don't appear to be. It's perfectly legal at this time to declare crypto profits as gambling and HMRC have confirmed that some cases may be investigated and assessed on their own basis.

"Perfectly legal" would imply you have a ruling from a judge on the issue. Could you please source that to back up your claim? If not, all you have is legal opinion. Could you source that instead? If you don't have either of those, all you have is a claim.

Even if true, do you not think it is telling that HMRC consider this gambling rather than sensible investment?

Finally, this isn't anything like how you made this claim to begin with. Remember saying this:

The way that legally breaks down is, if you buy crypto with money secured via a loan or similar, you are subject to capital gains tax. If you buy crypto with savings or wages, you are not.

This has nothing to do with gambling vs trading, so your "understanding" of tax has had to evolve in the last couple of hours. What else might you be wrong about?

Look, explaining why Bitcoin/Crypto is important and why it is changing the world is so difficult and so time consuming that I'm giving up. You either understand or you don't and if you don't, you owe it to yourself to find out more because it's not going away.

I looked into it and decided the emperor was wearing no clothes.

I highly recommend starting with a documentary entitled "The Rise And Rise Of Bitcoin" https://www.imdb.com/title/tt2821314/

And with that, I bid you good day and good luck with all future investments, I hope they are very profitable for all of you...if 4 or even 10% per year is considered profitable? Personally I prefer the 150% gains I've made on my last investment on March 31st, I mean...I'm no financial advisor but 150% profit in 1 month and 10 days, I think that's a fairly good return right?

You'd have done better if you'd put it all on a single number on a roulette table and won.

Those cynical of Bitcoin and digital currencies really need to have a long hard look at the fiat currency they're using.


Go in to your purse or wallet and grab a note.... any note.. on it will be "promises to pay the bearer on demand"


All these notes are just promissory notes/ IOU's


What are the notes promising? They are promising that you can take them along to the bank and get your gold and silver back in exchange for them.


Can you actually do that? No, governments abolished the gold standard so you can't do that anymore.

Why? Because the banks don't have any/ or enough gold


Where did all the original gold go? Who knows


So what backs the value of the paper? The government classing it as "legal tender" and a public belief that it has value.

Does that not leave it very open to manipulation, miscalculation, fraud etc? Yes

Go have a look in to the above/ validate

Have a look in to how cryptocurrency

Honestly... fiat currency that we use today far far more silly than cryptocurrency.