Fixing crypto Twitter starts with following positive examples – and a recognition of the problem.
Archives for December 28, 2018
Credit card giant Visa Inc. is acquiring British payments firm Earthport for $250.6 million. Earthport — which provides cross-border payment services to banks and businesses — has been partners with Ripple, the blockchain-based payment network, since 2015. Under the merger, Visa paid four times Earthport’s closing stock price on December 26, Reuters reported. Visa was interested in acquiring Earthport
The post Visa Acquires Ripple Partner Earthport For $250 Million appeared first on CCN
Ethereum is at best a $13 billion “science experiment,” believes Tuur Demeester. The Austrian economist, known for his anti-Ethereum remarks, explained why he has been overly pessimistic about the blockchain project in a 50-pointer thread. A majority of these points referred to the Ethereum team’s earlier promises of improving the main chain’s scalability. Ethereum Can’t
The post ‘Yahoo of Crypto:’ Bitcoin Economist Makes Case Against ‘Science Experiment’ Ethereum appeared first on CCN
A motion by the self-declared creator of Bitcoin and the chief scientist at blockchain firm nChain, Craig Wright, to have a multi-billion dollar lawsuit accusing him of stealing bitcoins belonging to an alleged business partner dismissed has been denied. Wright Loses Bid to Dismiss Lawsuit over Alleged Bitcoin Theft In a ruling delivered on Thursday
The post Judge: $1 Billion Bitcoin Lawsuit against Craig Wright Will Continue appeared first on CCN
Bitcoin price on Friday surged more than 7% against the US Dollar on a 24-hour adjusted timeframe. The bitcoin-to-dollar rate noted sudden spikes at the beginning of the US session after spending the day inside a narrow trading range. The move occurred just near $3,600, the resistance of said narrow range, giving the market a
The post Bitcoin Price Begins a New Ascent Inside Giant Bear Pennant appeared first on CCN
For investors whose first time investing in bitcoin was in 2018 or after late 2017, there is a high likelihood that they have incurred substantial losses for the fiscal year of 2018 if they haven’t sold yet. On December 17, 2017, bitcoin hit an all-time high at over $19,000. Thereafter, it has fallen over 80 percent and now hovers at around $4,000 at the time of writing. While losing money is never the end goal, there are certain measures investors can take in order to minimize their taxable income by utilizing their capital losses incurred from bitcoin during the current year and going forward.
Before diving into what measures can be taken, it is first necessary to address how the regulatory bodies who set these precedences view bitcoin and similar assets. Although this piece is centered on the U.S. regulatory requirements applied to bitcoin, it is worth noting that many other countries have similar regulations internationally.
Bitcoin Is Property
According to the Internal Revenue Service (IRS), bitcoin is considered personal property. As such, any tax laws applicable to the sale of a house or car, or more similarly, a security, will also apply to the digital currency.
Specifically, the IRS refers to taxes levied on the sale of an asset as capital gains tax, for which there are two types. Long-term capital gains tax applies to profits on assets held over a year, while short-term capital gains taxes apply to assets held for less than a year. Short-term capital gains are taxed at the same rate as an individual’s ordinary income tax rate, which in 2018 was somewhere between 10 percent and 37 percent, depending on your level of income. On the other hand, in 2018, the long-term capital gains tax rates are either 0 percent, 15 percent or 20 percent. The applicable rate used for the calculation is dependent on the level of income.
However, in this article we are discussing the opposite of gains, as there are probably very few who profited in 2018’s bear market. Capital gains tax rates are relevant to taxing profits but not losses. The good news is the IRS allows individuals to lower their taxable income by applying these losses.
If You Sold Your Bitcoin at a Loss
Plenty of people bought bitcoin during the bull run last year. Some “bought the dip” at various points on the way back down, only to see the price slide even lower. And many discouraged investors sold their BTC at a loss along the way. For those short-term investors, there is the opportunity to claim back some of those losses.
Similarly, if an investor bought bitcoin any time between late September (the last time prices were this low) and December of 2017, it is likely they have losses for 2018 that can be used to lower their taxable income if they choose to sell now. This would lower the amount of taxes they will owe from the given year, as long as the asset isn’t bought back within 30 days (i.e. wash sale).
According to the IRS, the maximum amount by which an individual can offset their taxable income for a single year is $3,000. But, if an investor lost more than $3,000, the remaining losses can be carried over to following years up to $3,000 per year.
As an example, if an investor bought 1 BTC in late December at $17,000 and sold it at $4,000 today, they would recognize a loss of $13,000. The investor, who is assumed to have regular taxable income, can reduce their 2018 taxable income by a maximum of $3,000. The remaining unused portion of the capital loss in this situation is $10,000. The IRS allows $3,000 of that leftover $10,000 to be carried over into the next year to offset any capital gains that may be recognized at the end of 2019.
The Case for Hodling
While selling bitcoin at a loss could reduce taxable income in the short term, many proponents of bitcoin would be quick to point out that the case for holding onto the digital asset is much stronger than selling for such a marginal and temporary opportunity to save a few dollars in taxes.
There are many who believe that bitcoin will eventually become a store of value, or sound money, and that the best days of bitcoin’s price are yet to come.
However, it is unpredictable when, or even if, bitcoin will accomplish this feat. Because it is impossible to predict the short-term price movement of bitcoin, it could be argued that the case for holding for a very long time (commonly referred to as HODLing) points toward a much higher future price of bitcoin that would make selling today, for a relatively small, offsettable loss, a much greater loss in years to come.
This article is for informational purposes only and does not constitute tax advice. As always, contact a tax professional to be sure that you are acting in compliance with your local tax laws.
This article originally appeared on Bitcoin Magazine.
A recent report in the Wall Street Journal details how Bitcoin is becoming an increasingly mainstream asset and is starting to develop strong correlations with traditional assets, including Gold.
The report cites the increase in institutional funding, increasing venture capitalist (VC) investments, and growing mainstream adoption as possible factors behind its increasing correlation with traditional markets. Despite this, the WSJ report also notes that Bitcoin is still far more volatile and riskier than mainstream investment vehicles, like the stock market or precious metals markets.
Bitcoin Developing Strong Correlation with Gold
Recently, talk within the cryptocurrency community regarding Bitcoin’s status as a safe haven investment – one that traditional investors turn to amidst instability in the traditional markets – has increased significantly as the US stock market faces growing volatility.
Historically, Gold and other precious metals have been the most popular safe haven investments, used by investors and institutions alike to hedge their positions within the equities markets. Many cryptocurrency investors hope, or expect, that Bitcoin will ultimately become a “Gold 2.0” that acts as a digital safe haven investment.
Although Bitcoin has never lived through a global financial crisis, statistics regarding its recent correlation with Gold show that it may be moving towards becoming a form of digital gold.
The WSJ report notes that on a scale of -1 to +1, ranging from completely inverted to perfectly correlated, Bitcoin is airing towards being perfectly correlated with Gold, trading at a 0.84 correlation to gold over the past five days. The data used is from Excalibur Pro Inc., a research firm.
Furthermore, Bitcoin also has traded at a 0.77 correlation with Chicago Board of Options Exchange’s VIX index, which measures market volatility and is widely seen as a “fear gauge.”
Institutional Money, Venture Capital Driving Bitcoin to be Mainstream
The report also notes that Bitcoin’s increasingly mainstream nature is being driven by an influx of institutional funding and more venture capital investments entering the industry.
Recently, news has broken regarding multiple financial institutions entering the cryptocurrency markets, like Fidelity Investment’s institutional-aimed cryptocurrency exchange platform, and the OTC exchange-traded Bitcoin ETF trust sold by Grayscale investments.
The report explains that the Grayscale ETF has grown from having a mere $3.5 million under management in 2013, to highs of approximately $3.5 billion by the end of 2017 at the height of the cryptocurrency bull market. This fund has lost a significant amount of funding throughout the 2018 bear market, and currently has about $900 million in funds under management.
Venture capital investments in the industry have also helped propel it as a mainstream investment, with a significant amount of VC wealth flowing into blockchain and cryptocurrency companies. The WSJ says that in 2013, VC investments in the blockchain and crypto sector totaled at a mere $96 million, swelling to over $500 million by the end of 2016, and then skyrocketing to over $2 billion by the end of 2017.
As more companies release their products aimed at onboarding institutions into the cryptocurrency markets throughout 2019, Bitcoin’s status as both a mainstream investment vehicle and a safe haven investment will become increasingly clear.
Featured image from Shutterstock.
The post Report: Bitcoin Conforms to Mainstream Markets, Strong Correlation with Gold appeared first on NewsBTC.
A blockchain data research firm has released a damning report which accuses several major cryptocurrency exchanges of engaging in unscrupulous activities aimed at faking bitcoin trading volumes. According to the Blockchain Transparency Institute (BTI), only three cryptocurrency exchanges of the dozens surveyed — namely Binance, Bitfinex, and Liquid — were found not to be “grossly
The post Major Bitcoin Exchanges Accused of Faking Volume: Who’s Trustworthy? appeared first on CCN
A sculptor inspired by Bitcoin has created a beautiful piece of artwork commemorating the financial and technological innovation. Each element of the sculpture highlights an important quality of the decentralised digital currency.
Bitcoin Sculptor Celebrates Bitcoin’s Tenth Year
The sculpture created by Moratz is titled “Why Bitcoin Matters”. Various elements of its designed have been chosen to represent the disruptive properties of the world’s first viable digital currency.
The main body of the sculpture is made out of a wood with a strong grain that spreads out across the piece. According to Mortaz, this represents decentralisation – the idea being that Bitcoin usage and knowledge is spreading globally as the technology ages.
The circle surrounding the classic Bitcoin “B” logo has been crafted from stone and represents the global nature of the Bitcoin network. In the artist’s own words:
“The stone ring symbolizes the ability to send value globally and borderless.”
Adorning the “B” itself are flowing waves. These have been chosen to highlight the “free flow of money” made possible by the decentralised monetary network. The permissionless nature of Bitcoin allows for value to travel wherever the sender desires.
Also featured in the patterning of the wood are annual rings. These spreading layers from the robust core represent the additional layers being working upon to allow for optimisation for different purposes. These include Lightning and Liquid Networks.
Finally, the base plate for the sculpture is made using coloured stones. Moratz states that this represents inclusivity. No one can stop anyone from using Bitcoin no matter who they are, what colour they are, and what their believes are:
“The Bitcoin network treats every single person equal, and everyone can participate.”
I created a sculpture called “Why Bitcoin Matters“. It illustrates 5 key aspects that make bitcoin indispensable on this planet. details explained on the picture and more info on the website:https://t.co/RBtO9q5LqT#mycryptoart #cryptoart #whybitcoinmatters #ProofOfKeys pic.twitter.com/gTyJF87Kou
— mycryptoart (@mycryptoart) December 28, 2018
The impressive piece stands at 170 cm tall. It was created using materials scavenged from remote Austrian valleys by the 27-year-old artist.
Crypto Art as a Reflection of a Crypto Society?
For centuries, humans have used artwork to comment on the society around them. It therefore makes sense that Moratz would be drawn to Bitcoin as a subject matter. Bitcoin, after all, has the potential to disrupt one of the major communication tools we have as a species – money.
A small but growing group of artists have created similar pieces over the course of the innovation’s transition into the mainstream. Earlier this year, NewsBTC reported on the public sculpture unveiled in Slovenia depicting the iconic “B” logo.
More recently, there was the story of the “Art (r)Evolution” exhibition held in Paris, France. Artwork displayed at the crypto-focused event explored the cultural impact of Bitcoin on society both today and going forward.
Artists have even explored using the alternative payment method as a way of subverting the typical art auction model. In August, NewsBTC reported on artist Lincoln Townley who created a collection of work that he would only sell in exchange for Bitcoin. This allowed him to monetise his work without relying on galleries. Townley stated:
“The best thing is it fuels my belief that galleries are secondary to an artist’s success – they just need to look at galleries as another string to their bow. There are so many other ways to get sales with technology.”
Related Reading: Andy Warhol Paintings to Be Auctioned for Cryptocurrencies
Featured Image from Shutterstock.
The post Bitcoin Artist Explains “Why Bitcoin Matters” Through New BTC Sculpture appeared first on NewsBTC.
Back in September, biotech billionaire Phillip Frost and eight other individuals were charged by the SEC for a penny stock scheme deemed fraudulent. Frost was not at the core of the scheme, which involved buying up penny stocks and effectively pumping their value only to dump them at massive profits. Overall, before they were caught,
The post Biotech Billionaire Settles with SEC over Crypto-Related Penny Stock Scam appeared first on CCN