Bitcoin Forum

With all the hodlers and pro traders yelling at eachother recently, this thread seems appropriate. For my part there is this:

I suspect I would be a poor trader. I understand the fundamentals, the code, the economy and where it's headed, the growing disapproval with banks and politicians. I don't know where the price will be in two hours.
I don't trust any of the exchanges enough to hold my money, either kind.
Don't need the stress.
Legal reasons. Right now there are next to no laws about bitcoin, who knows what kind of rules will be imposed in the future. Possibly retroactively. Too big a risk in a socialist utopia.

Anyone else?

LOL

I'm not sure you know what socialist means.  Also, that utopia literally means "no place".

I don't trust any exchanges.

How about day trading a commodity with a (historically) exponentially growing price is stupid.

I do trade sometimes, but I don't trust exchanges with more than 10% of my total wealth in bitcoin. I could decide not to trade at all, but sometimes there are very clear opportunities I would hate not to be able to take advantage of. But most of the time I just hodl and enjoy the ride. If I was a good trader I would probably trade more often, but I just can't and don't want to deal with the stress that comes with it.

Cause I sux @gambling.

Used to trade (poorly), but don't trust any of the exchanges with even 1% of my coins. Plus, I think the fees/process of moving fiat in and out is too much of a barrier right now.

you don't need to move fiat in or out, unless cashing in or out. put btc on an exchange you trust most and trade away. when done, withdraw btc.

This.  I would love to trade, and the infrastructure has gotten a lot better, but I still don't trust it enough to keep BTC deposits anywhere other that a very small handful at Coinbase, and the rest in my offline wallets.

Also, I'm being cautious in regards to tax obligations.  US citizens who are trading willy nilly, and not keeping good records may well find themselves in a very unfortunate position in the future.  The tax trouble could be worse if you're using foreign exchanges.  And it could especially be bad if you're cashing out a lot, using the money, and not holding a good portion in reserve.

Until we get something definitive from the IRS, I'm going to try to make the case for long term capital gains, and to safely do that I'm keeping the vast majority of my coins off exchanges and at addresses only I (and a few trusted people) have control over.

Good luck to anyone in the US recklessly short term trading/cashing out noticeable sums of money using foreign exchanges without any thought for accounting and tax obligations.

Trade BTC for profits -> Cash out vast amount of profits -> Spend profits on whatever -> Bitcoin crashes -> Reserve Bitcoin worthless -> Government finally catches up to your scheme -> Demands taxes @ 35% on every short term trade you ever made + 15% on long term trades = Nightmare scenario

That's certainly a horrible scenario, but I think the more likely one, which can be just as bad, is that you cash out a lot and spend more of the taxable profit than your ordinary ability to pay on the obligation.  I'm convinced that more than a few people are going to get stung by this.

Any US transfer amount over $10,000 is required to be reported to the IRS by the bank.

So if you're cashing out like a boss, they already know.

Which makes it all the worse if you're recklessly spending it all.

I trade with approximately 10-15% of my holdings.