Bitcoin Forum

Hello,

Until recently I had only vaguely heard of Bitcoin but during the course of starting up a new business we came across a web developer who requested to be paid in Bitcoin, thus marking my nose first dive into all things Bitcoin. I'm still incredibly new with all of it and at first it was more than a little overwhelming but I'm learning more and more and plan to continue doing so.

On to my first point, I was wondering if anyone had a strategy for buying Bitcoin... it seems to be a bit volatile to me so come on guys, what's the secret? Money is a little tight and I'm finding the fluctuations either cause quite a thrill or a sinking depression. Any advice?

Lastly, we're considering accepting Bitcoin in our new business. It's a largely online venture and it seems to be a good option for Bitcoin but I'm not sure if my excitement is getting the better of me, are there any intricacies or major complications for businesses and Bitcoin? Especially come tax time or maybe something else altogether I'm not thinking of?

Thanks for taking the time,
Grant

"No sooner you're up, you're down again" - Mick Jagger

Who cares about 'volatility'?  If you lose 10% today, you'll gain 10% tomorrow.  Do you think Warran Buffet cries about losing $300 million some days?  No!, the very next day he makes $300 million again.  Don't watch the ticker.  In the long run, if bitcoin doesn't fail, you'll have more gains than losses.  That is all you need to know.

As for taxes, bitcoin is identical to dollars.  Tax is on income, capital gains, et cetera.  Tax is not on 'dollar', 'bitcoin', 'euro'.  Whatever income you have - it is taxed.  Even if this income is denominated in dollars, bitcoin, rice cakes, or whatever.  You've got to pay your income tax on all income - no matter the denomination.  The denomination (e.g. bitcoin) doesn't relieve you from paying tax on income.  Pay your income tax, and hope you get to pay more next year.  

If you are an online venture, and have a lot of sales daily, then bitcoin would definitely be an awesome option to add.

For getting away from the volatility you can probably try out services/payment processors, which exchange your bitcoin immediately to $, at the time of acceptance.

Put some fraction of your income into bitcoin, regardless of price, until the price reaches $100,000.   By then you'll have enough accumulated that you should just HODL.   ;)

Forget about the price unless you plan to trade, and just wait 3-5 years and see what you want to do.   That would be my long terms strategy..

You can take of the volatility using a 3rd party like bitpay or coinbase to process payments, this way once someone pays you you will get credited that exact amount in your USD$ account without any fees.

Use BTC as your savings and dont htink about it just accept payments from your business and let it build then you will not have to worry about buying anyway, i know product cost money to produce so cashouts will be needed and you can usually find someone ready to buy maybe even a little over market value

Hi Grant,
I am bying bitcoins as part of my porfolio. I do not see a strategy. Each week I transfer few thousands Eur to exchanges and start buying. If you want to save few bucks from thousand do not buy few BTC's at once, because market depth of exchanges is not too big.

Another advice: never leave unused money at exchanges, withdraw them immediatelly, if you do not intend some active trading, which is not your goal anyways.

As for the taxes: the simple truth that everyone will hide, because most ppl do nt want to feel guilty... BTC is here and one of the values of BTC is tax evasion. BTC does not cut just transaction costs, but also overall costs, because simply many trades, buying labourforce etc. is not necessary to report. Love it or hate it, one day your competition will for sure take advantage of it and that day can be end of your business if you do not adopt.

Use a new public address for every transaction in which you receive bitcoin.
I like Electrum for cold storage.

Electrum, and armory would be great to create multiple addresses and storing your coins.

I think that right now is very good time to buy Bitcoins, because price is very low.
Generally, when price is low, it's always good time to buy and sell later, when price id higher :)
Regarding taxes, if you do bank wire, I guess, you will have to pay taxes but if you cash out your BTC at Bitcoin ATM, you don't need to pay anything.

Well you never can't say what price is low or what price is high.
even when prices were at 320 before, it wasn;t certain if this is the lowest.I guess its upto you to decide, if you want to hold on to them and take the risk,
 or do you want no risk while accepting bitcoins.

Well for one, I'm not going to convince you to take the plunge and put everything solely on bitcoin. Every investment has a risk and it's all about managing and mitigating the risk to acceptable level. As for your case, i believe there are already businesses working on it. Their contingency plan from what i know to lessen the risk is by reducing the time holding onto bitcoin by quick selling one portion and another portion remains. The size of the portion is up to you to determine though based on your business strategy.

I don't think a risk has to be taken, if you use services to trade your bitcoin for fiat, right after a buy.