Crypto Currency Thread
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The Nags Head?
Tom Hark
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I amassed a small portfolio a couple of years ago, funnily enough after having a long chat with a guy in a pub. It's mostly XRP, which was supposed to go to the moon after the SEC action failed (made no difference whatsoever). It's currently worth about 60% of what I bought it for. When it reaches 100% (which I'm sure it will eventually; there's no-one so over-optimistic as a crypto bull) I'll sell and not bother with crypto again.
Tredman
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I did exactly the same with Bitcoin and Ethereum. Both were well over 300% at one time but crashed. I got out at 100%, not for me.,
It’s all alien to me but I had a customer back in Cambridge, a Scottish guy in his 20’s, who had once gained a huge amount and then lost it all (he did explain why but it went above my head), and then on a second wave (this was the time I met him) had a balance of £240,000.
He wanted to know a bit about property as was looking to liberate the funds and at least have some stability in bricks and mortar, but I recall converting his ‘asset’ to hard cash was the difficult part. Again, not too sure how that actually works in practice but, there were significant traceability and tax ramifications if I recall correctly. No idea how HMRC goes about dealing with that.
Seemed to be a time when there was a lot of boasting about how much money was being made in crypto and fair play to anyone that has, but I’m curious if anyone has actually made the sort of sums that could be used to buy (or be put towards) an asset such as a house, and how the tax was paid, what the banks and money laundering regs had to say about the origin, and what HMRC and the land registry made of it.
Or put more simply, how legitimate is the ‘profit’ and does it enter the mainstream economy seamlessly?
He wanted to know a bit about property as was looking to liberate the funds and at least have some stability in bricks and mortar, but I recall converting his ‘asset’ to hard cash was the difficult part. Again, not too sure how that actually works in practice but, there were significant traceability and tax ramifications if I recall correctly. No idea how HMRC goes about dealing with that.
Seemed to be a time when there was a lot of boasting about how much money was being made in crypto and fair play to anyone that has, but I’m curious if anyone has actually made the sort of sums that could be used to buy (or be put towards) an asset such as a house, and how the tax was paid, what the banks and money laundering regs had to say about the origin, and what HMRC and the land registry made of it.
Or put more simply, how legitimate is the ‘profit’ and does it enter the mainstream economy seamlessly?
Was lucky enough to have an informal conversation with an old-skool retiring investment analyst in about 2000, must’ve been around the dot com boom who was irritated by the brash boasting of huge ‘profits’ by those speculating in the new sectors.
His line that resonates to this day was, “Never forget, a profit isn’t a profit until it’s banked.”
As an outsider seems like crypto might be the epitome of that, which I guess is why I’m curious about the questions asked previously.
SSB
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Funnily enough I used to work with a couple of lads that used to always say "to the moon, to the moon"
I've not heard them say it for a good while.
wanderer89
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Mate of mine bought an NFT for £600, sold it a week or so later for £26k.
Do you know anything about the costs, tax etc involved? I’m assuming if you’re employed (i.e. don’t have to do a tax return) you could potentially have 26 grand dumped into your bank account and blow the lot on sex and drugs and rock and roll without HMRC knowing anything about it. However, unless I’m mistaken banks are beginning to ask questions about large deposits too. Transfering that money into property is another matter again (see above).
I’m not a gambler but he sounds a bit like the bloke down the bookies who only ever tells you about the winners.
Paddingtonwolf
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CGT is usually due on share sales above a certain amount. Personally I view crypto as the most dodgy thing out there and would never touch it but if people get enjoyment who am I to argue?
I bought my first BTC back when they were worth around $8 each in 2011/12.
If I'd kept some of my early trades instead of spending it, and sold at the height of the bubble in 2021, I would now have several million pounds. But noooo, I had to buy drugs and have fun instead.
If I'd kept some of my early trades instead of spending it, and sold at the height of the bubble in 2021, I would now have several million pounds. But noooo, I had to buy drugs and have fun instead.
Interesting comments.
When it comes to crypto being dodgy then yes it is. For instance if one holds their crypto on an exchange and the exchange goes down thru a hack, fraud or bad management then you have lost that money in most cases. But being on an exchange allows the quick transfer of funds from one type of crypto to another or to fiat currency.
If one buys into a new crypto that's supposed to be god's gift, it's a scam. Much as you see in many other ways that fraudsters try to get you to invest.
If you buy crypto and hold it in a wallet to which only you have access then it simply stays there and the value fluctuates accordingly. Turning this into GBP is actually quite simple in small amounts. Say a grand a week. I'm not sure as I've only sold a few grands worth.
Anyway, long and short is you can be safe if you know what you are doing. You can't guarantee profit, much as if you buy shares.
I hold ETH and BTC, BTW. If we see BTC holding above $30k by the end of the year I'll be happy. ETH and BTC tend to rise and fall at very similar rates.
All those years ago when I was talking to this chap down the boozer he was saying: buy it and hold it in a wallet, you will make money. Back then I think it was about $70 a coin and now it's $27k a coin. I expect he's rolling in dosh. Never seen him since. Itwas a random conversation between two guys smoking outside a pub that turned into me learning a lot. But I didn't act on it.
When it comes to crypto being dodgy then yes it is. For instance if one holds their crypto on an exchange and the exchange goes down thru a hack, fraud or bad management then you have lost that money in most cases. But being on an exchange allows the quick transfer of funds from one type of crypto to another or to fiat currency.
If one buys into a new crypto that's supposed to be god's gift, it's a scam. Much as you see in many other ways that fraudsters try to get you to invest.
If you buy crypto and hold it in a wallet to which only you have access then it simply stays there and the value fluctuates accordingly. Turning this into GBP is actually quite simple in small amounts. Say a grand a week. I'm not sure as I've only sold a few grands worth.
Anyway, long and short is you can be safe if you know what you are doing. You can't guarantee profit, much as if you buy shares.
I hold ETH and BTC, BTW. If we see BTC holding above $30k by the end of the year I'll be happy. ETH and BTC tend to rise and fall at very similar rates.
All those years ago when I was talking to this chap down the boozer he was saying: buy it and hold it in a wallet, you will make money. Back then I think it was about $70 a coin and now it's $27k a coin. I expect he's rolling in dosh. Never seen him since. Itwas a random conversation between two guys smoking outside a pub that turned into me learning a lot. But I didn't act on it.
wanderer89
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I have no clue unfortunately. All I know is that he went travelling around the world with it and is now at Uni.
Thanks for the reply.
Didn’t mean to sound critical, it’s just completely at odds with my way of thinking and from the outside a lot of things Crypto don’t seem to stack up, but fair play to your mate if he’s ‘banked’ his profit (Golden rule number 1) and spending it as he sees fit.
Good summary, thanks.
The ability to trade rapidly and engage in profit taking and have a stop-loss built in minimises risk and essentially becomes very similar to trading in shares. That makes it more appealing to my mindset but I guess not where the big profits might lie. Seems like unless you’re going all-out with the subsequent big risks might as well stick to FTSE or AIM.
That said, I think if I was young now the temptation even as a non-gambler might be overwhelming. Goodness knows how much money is being lost by people who don’t really have it to lose, desperate to get rich quick tempted by the headline figures. Seems a bit like buying a scratch card or going to a casino with the added risk of being scammed altogether.
It’s a no from me, but can see why others take a punt. I’ve a feeling the “no” could become a ‘let’s have a look at this’ morphing to a ‘let’s have a little dabble’ over time.
It depends on the type of crypto and how you use it but yes, it is often traceable.
Daft question time - For the average Joe with nothing to hide who would pay tax on any profit does it matter if it’s anonymous or not?
No, of course not. It's not really any different to trading shares if you do it properly.
Interesting fact. A few years ago I was buying about £700 worth of BTC from a UK company I've been using since 2014. It's a simple transaction, I say how much I want to buy, they tell me the cost in GBP, I do a direct bank transfer and they send the crypto to my wallet. It called up some problem with my bank and I had to talk to a guy on the phone. He didn't have a clue. He was sure it was a scam. I kept telling him how it works but he couldn't get his head round it. So even bank fraud advisors have no idea what they are talking about.
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