There remains hope that our brief dip under $6000 several weeks ago remains the bottom of this Bitcoin price correction.
I know that's what everyone wants to hear in these, what passes for dark times (and would have passed for "the moon" one year ago.)
Luckily, I am here and willing to give you vague speculation based on the charts of others.
In a recent Reddit post that went viral (and was later removed for rule violations in the comments, and the OP going AWOL after opening the discussion), a user complained that his "life had been ruined" after he cashed out large crypto profits in December without realizing he had incurred tax liability by trading. He then proceeded to (presumably) donk all that money off into the world casino, leaving him with only a few alt-coins which crashed in value and are now nowhere near enough to pay the taxes he didn't know he owed.
Blaming crypto-trading for "ruining his life", when the actual problem was having an understanding of tax law somewhere between middle school and high school students, is rather hilarious. It does illustrate yet again how frequently entitled, helpless, and prone to blame-shifting the young generations are currently.
More interesting than another Grandpa-rant is Zero Hedge's coverage of the post, which veered off into more interesting territory by covering a theory floating around about cryptocurrencies being liquidated to cover tax bills. This would potentially account for a large amount of the recent price drop, if analyst Tom Lee's estimates are to be believed. He suggests that every $1 removed from the market via cashing out reduces total market cap by $25. He also calculated that cryptocurrency capital gains should technically account for about 20% of 2017 capital gains taxes in the US, a surprisingly large proportion
If he's right, we could begin to see a rebound after the dust settles from tax payments to the IRS in April.
We also have a Radio Station! (click me)
...and a 10,000+ active user Discord Chat Server! (click me)
Sources: Google, Bitfinex, Reddit, Fundstrat, Bloomberg, Zero Hedge
Copyright: SmartSteem, PALNet, SPL, Reddit, Cryptowatch, Monopoly
Generally you only pay taxes if you are gaining money. If you started investing in crypto in december like I did, you would, by now, not have gained much. In fact you probably lost 50% of value if not trading heavily against the markets loosing massive ground.
Profits and losses would be compared and only for profits you pay taxes.
Obviously 2017 was so crazy that it was possibly harder to loose money, therefore profits were extremely high. Thats how it is though, your countries infrastructure is paid bytaxes, think about that.
I still do not get why this guy did not just pay his tax and wasted it all. Possibly a sign that it was (no offense) realy not too dificult to make profits last year. 😏
Yes you pay much more when you gain some dividend like the Gas for Neo ! But in several country you have to pay a taxe for your value benefice. Some friend of mine told me that there are some countries where you cash out very easily and without taxes: Switzerland, Monaco or Luxembourg.
Oucch that really hurts . I dont think there is a massive sell-off hapening now for tax preparation (if anything it has already happened ). Market is skeptic for a lot of reasons . Retails investro driven markets are generally slippage prone , manipulation prone too. That could possibly be the reason in a largely unregulated market.
There is an excess of ethnocentrism here.
The correct sentence is:
"cryptocurrencies being liquidated to cover USA tax bills."
From 1st April 2017 to 18th April 2017 bitcoin price rised from 1100$ to 1250$...
It's a +12% gain
In 2017, USD was among the most traded currencies traded for bitcoin, behind the Chinese Yuan.
In 2018, USD still is among the most traded currencies traded for bitcoin, behind the Japanese Yen.
The American dollar is as much traded for bitcoin than it was in 2017.
In 2017, tax day in USA didn't affect Bitcoin price
In 2018 many American traders thinks their tax day influences Bitcoin's market.
I'll let yourself make your own conclusions
I believe other crypto traders have mention this too. I ponder how much it really effects when majority of the crypto trading is outside North America. Still it is one bright spot to hope for to end this cryptocurrency draw down. Thanks.
First, we have to make money, and then pay taxes.
But then taxes crashes the market, so we are left with less money and more taxes to pay.
How fucked up our life is!
If our congress wasn't so retarded, our taxes would only come from duties on imports and they would be leaving us alone. But they long since stabbed us in the back, and many have left the country over it (this schedule D thing) in the past-taking with them money they could have invested in our economy.
It may be painful in the short term, but Trump is steering us in the right direction with domestic tax cuts and trade tariffs. But it won't do any good if we keep spending more than we can sustainable borrow. The other problem is our workforce has become rather uneducated; the vast quantities of college educated people probably don't have the first clue about performing the tasks needed of the old economy that will gradually be returning. But i suppose it is for the best, a return of manufacturing would almost immediately make the David Hoggs of the world look like the morons they really are. It would almost put to an end feelings based legislation.
Reminds me of Dune. Fremen were so much stronger when the planet was a barren wasteland desert.
I sincerely doubt that Trump is going to pull us in the right direction. Even he is a bit of an elitist, and that would be generous.
As to the history of the income tax, scholars will tell you that the 16th Amendment never conferred any new power of taxation upon Congress, it was merely a clarification. It was also a joke played upon the D's by the R's and it went too far.
As to the debt, it's worth noting a few other things. China loves our debt. They keep buying it to keep the dollar good and strong, and that blows up the trade balance in their favor. China simply has no compelling interest to see us stop spending money "we don't have". But even fewer people will notice that the federal government is a sovereign. It can never go bankrupt.
Feast your eyes on this interesting treatise on money:
http://neweconomicperspectives.org/2017/12/defining-tax-reform-battleground.html
The money has to come from somewhere before it can be taxed. Where does it come from? We print it, the government spends it, and it goes into circulation (I'm not talking about the fractional reserve part).
For Trump to do any good to the economy, he'd have to plug the hole known as the trade deficit, some $500B a year, demand that is going elsewhere. And his business cronies won't have it because that would create demand here, tighten the job market and raise wages.
And I'm not so sure that Congress is retarded as they are Pavlov's Dogs, trained to vote for money.
You have an interesting point.. i enjoyed coming across your opinion.. Enjoy your weekend!!
Agree wholeheartedly with this:
"And I'm not so sure that Congress is retarded as they are Pavlov's Dogs, trained to vote for money.
This taxation system requires a change.
We can't earn money like this!
You could always go full rogue and hide your money on a privacy coin. I think privacy coins are way undervalued. Once the government starts coming after people they are going to go way up in value.
True, however look at it this way. Some people didn't sell Bitcoin at 19k or other coins at highs because they didn't want to incur short term capital gains. I"d rather pay 28% in taxes than lose 80% of my money sitting in crypto.
Which privacy coin do you think is the big winner in 2024???
I think diversity is important; there is no one true coin. There are really only bad coins you should stay away from. I haven't done the research on privacy coins so I don't know.
Good post, I follow you, I hope it is useful for me and for you.
We need to go to a fair tax or flat tax. There's no reason taxes need to be as complicated as they are
Couldn't it be argued that Taxation is Theft??
hope for the best :)it happens
Lol! I don't know why people think they are not going to have to pay tax on their gains. If you pay it on other assets, this seems logical. Or not apparently. People need to plan better to minimise their tax liability. It's what rich people do.
Sure, but I think the real problem is that the tax itself is causing the market to crash. Then there are people who didn't make anything but still get taxed. It's very dark comedic irony on multiple levels. The government doesn't even accept cryptocurrency as a currency, it's ridiculous.
Is it though? It's been in a downtrend for a couple of months. Plus this assumes that everyone's tax year runs the same as the US, which is not the case.
Is the US tax year contributing to the bear market? Sure, maybe. Is it causing it? I'm not convinced.
Oh I'm not convinced either. I think people try to figure out what news is causing whatever crash or upswing and sometime's there just isn't a reason. The price went up. The price went down. Simple correction.
Still you have to admit that being forced to pay taxes on money that doesn't exist simply because of the way the dates fell is... archaic. Advancing technology points out how inefficient systems of government are and how unable they are to change.
Yeah everyone acts like it was some groundbreaking thing that you have to pay taxes on crpto, crypto is an asset class just like gold silver or anything else.
Surely people put aside money all year for their tax bills, rather than sell assets at the last moment to pay for them?
good time for investment
dear friends do not wait more
Thanks a lot for sharing your valuable post....
Carry on next
Best of luck..
I will still wait for your next post....
Only time will tell if bitcoin will see surging recoveries
or if it will continue to stagnate while altcoins rise to be king. This technology is so new, nobody can know for sure the future of the blockchain and what it means to mankind. But I tell you one thing, thanks for your contribution to this platform. It means the world to so many of us!
upvote...I think you'd find my just up post informative..thanks..
Go Yankees.. Tough loss last night...=(
There are buyers at the $6000 level.
bitcoin bitcoin bitcoin. this achievements is your power. thanks for sharing.hope everyone will be benefited on this.keep sharing.keep going on your way
Every time I hear "tax", my ears hurt and my heart feels like I wanna hit somebody. I hope there come a time when "tax" can be pleasant to the ear.
sounds pleasant in Wyoming or Puerto Rico
So many things are explained by this.
This theory does not seem legit at all. If people have no choice but to cash out of bitcoin to pay taxes, then the market should simply crash till the tax deadline - it should be a buyer's market. We have had a number of theories come up since btc price started correcting in Dec. It has been almost 4 months and I think this market is purely Technical analysis driven. There are a number of Hedge Funds and whales trading bitcoin with large capital but the market has yet to see long-only institution money come in. Once that happens, the correction will be over. Btc needs to become an asset class for institutions - capital comes in, vol goes down, bitcoin becomes a store of value and gets acceptance from merchants and we have a functional digital currency.
Excellent article.
Come to my blog, do not hesitate, comment. I'll be happy!
Thanks a lot for sharing
I know it looks bleak but even with the recent crash we are still up over 500% from this time last year. That kind of growth is going to have growing pains. Also the big boys do everything by quarters of the year. This is the beginning of a new quarter
Wow nice your post
You got a 8.69% upvote from @postpromoter courtesy of @lexiconical!
Want to promote your posts too? Check out the Steem Bot Tracker website for more info. If you would like to support the development of @postpromoter and the bot tracker please vote for @yabapmatt for witness!
Military film / Military education film
PLS Reesteem and share it!
I remember reading this on Reddit and was really confused how this could happen. If he has gains, and then has losses, those losses should offset the gains. The only thing I can figure is the gains were 2017 and losses will go on 2018 taxes, so he's not out that money but will be out that money for a year if that makes sense?
Could he really have nothing to show for it but still owe 50K?
Here's my other thing, assuming he's using an exchange like Binance, they aren't reporting to the IRS so why not just act like that never happenned and only claim anything he's cashed out through Coinbase and/or Gemini?
As you said, the problem was he realized gains in 2017, and his losses are in fiscal 2018. He may have problems paying the difference.
I hate to encourage people to cheat taxes, however in his circumstance, and given how overly complicated our tax system is, as well as the lack of clarity on crypto taxes, as well as the lack of clear reporting from exchanges, I would almost tell the kid look, pretend that the altcoin trading never happenend, only report on what came out of Coinbase because that's all the IRS is goign to have reported to them, if even that.
I was in the middle of writing something like this as the reason why I think the story is BS, but you beat me to it.
In my opinion, someone who is dealing with those numbers knows a thing or two or know somebody who knows a thing or three.
The continuous dip of bitcoin is really becoming worrisome... I feel like selling my remaining bitcoin so that I can finally have peace of mind
This is the time that the patient is taking money from the impatient...HODL
nice post bitcoin has been one of the cytocurrency that has always gone viral all the time .i just followed you ,will be writing my introductory post soon and I just joined steemit
I don't see April 18th as a crisp inflection point. But as tax time in the US fades for the year, it might help nudge the sentiment into a more positive vein. The peak in December turned out to be quite inconvenient because you can't cash out for a loss and reduce your taxes. All the big losses that might provide tax write offs happened this year.
visit@Yankee-statman. It's about sentiment and some market and econ. fundamentals....thanks
You can file for extension to October.
BTC prices will go down to $4,000's as the low
https://steemit.com/bitcoin/@davebrewer/bitcoin-prices-won-t-be-at-the-bottom-until-they-drop-down-into-the-usd4000-s
Time will tell, historically Q2 is a good quarter for bitcoin, so maybe after the tax season, we could see some bullish moves
You got a 5.55% upvote from @upmewhale courtesy of @lexiconical!
Earn 100% earning payout by delegating SP to @upmewhale. Visit http://www.upmewhale.com for details!
Great post ! just looking forward to it going back up , fingers crossed !👍
