Neither the dividend interpretation nor the stock split interpretation seem to fit, as it's very unlikely that cryptocurrencies can be treated as securities. This CPA advises "reporting the value received as 'Other Income' on line 21 of Form 1040 —a catchall category for income that does not fit into a standard category."

That seems pretty reasonable since, as you said, US tax law doesn't adequately account for fork coins. So his take is that the $266 per BCH (price at launch) is "other income." That $266 per BCH would also form the cost basis for calculating capital gains upon selling the BCH.

Here's another idea that would reduce taxable income. He was less keen on this:

Thanks, that was more useful than I thought. But there's no instructions on how to withdraw the ETH that's in the smart contract. That's the majority of my stuck funds. Any thoughts on how to get those out?

You should already have your private key backed up. Just import it into a wallet like MEW and sweep funds to a new address to be safe. The problem is the 51,850 ETH and countless tokens stuck in the smart contract. Fortunately it looks like this was limited to the DNS. But until this is safely resolved, I have significant funds locked in the smart contract.


Using EtherDelta is crazy, why? I've done well trading there, and even when the site was compromised today I was able to remove most of my funds safely because I control the keys. The smart contract is intact; no funds have been removed.

It's actually the first step towards a permanent scaling solution (Lightning). My understanding is that all Lightning code was written with Segwit's malleability fix in mind. It should be noted that Segwit is just a small linear capacity bump.

I'm seeing a lot of people make a big deal about exchanges not adding Segwit, but the difference would be marginal. Last month, you could pay 5 satoshis per byte to push a transaction, and fairly quickly. Today, some people are paying 600 satoshis per byte. That has nothing to do with Segwit adoption.


It's pretty obvious by now what's going on. Someone waited until just after the last difficulty adjustment to drop 4-6 exahashes of mining power from the network. This coincides with a spam attack. What else does it coincide with? A BCH pump, of course! They're even promoting it on CNBC now. This has Jihan Wu and Roger Ver's name all over it.

Kraken doesn't have complaints about its KYC procedures, but there are lots of complaints about its performance. It was constantly offline throughout November during all the volatility. It's a good place to dump some USD and wait out a correction, or maybe enter and exit swing trades during low volatility. But I wouldn't day trade there. Really shitty trading engine.

I hate KYC myself, so it sucks when my coins aren't listed on Binance, Bitfinex, Shapeshift or Changelly. Those are my go-to services (in order). There's unfortunately still lots of markets that are mainly only available on Poloniex or Bittrex. I don't put more than a few thousand dollars at risk in either account. If my accounts get locked, I'm gone....

Yeah, it's intriguing to watch this play out. On one hand, it seems like many governments/central banks are acknowledging that they can't control cryptocurrencies and are focusing on taxation and investor-focused regulations. Part of me thinks, "maybe Bitcoin could be a normal commodity like gold."

But in the context of devaluing fiat currency, cryptocurrencies begin to look attractive. Why store value in the declining dollar when everyone else is dumping their money into growing math-based currencies? Could they really begin to threaten governmental monetary sovereignty? And if so, what will governments do then?

Maybe we'll start to see more bans on cryptocurrency businesses, mining and even payments. Then maybe we'll see how resilient Bitcoin really is!

Don't post on a forum asking for financial advice. You're literally asking shitposters to decide your financial future.

When it comes to investments, you should be moving slowly. You shouldn't be chasing price. Selling all of your bitcoins for a shitcoin like BCH? LOL. You better slow down and think this through. Why would you invest in BCH? Why is it a superior investment to BTC? Temporarily cheaper fees, that it? Bitcoin is the most utilized network in the world and offchain mechanisms with lower fees are coming. Think about the long term prospects. Look at what's happening in the mainstream. Is everyone talking about Bitcoin? Or BCH?

Some people see Bitcoin Cash as an attack on Bitcoin, to the point where they won't trade it. Personally, I don't mind. But for me, it's just a trade, not an investment. Seeing the price of BCH double in a day can be an emotional experience, but remember what happened the last time around. It brutally dumped afterwards, and Bitcoin went to new highs. Be prepared for that to happen again.

Yes, there's no law against that. There's a separate issue of whether any given exchange prohibits US residents -- Bitfinex and Wex do, for example. Cryptopia allows them, though. In general, just check the terms before you sign up and fund an account.

Technically, I don't think it's unlawful to conceal your location to trade on Bitfinex or Wex (with a VPN) either. But it would be violating their terms of service and they could probably get away with confiscating your funds if they caught you.


At the rate this market is evolving, it probably won't be long now.

It essentially caused the same effect as spam attacks in Bitcoin. It's comparable to Satoshi Dice during its heyday. You just need to pay higher fees (gas) to get instant block confirmations. The real problem with the CryptoKitties launch was that exchanges weren't prepared for the volatility in required gas.


Honestly, I'd say that no blockchain is ready for production/mainstream use. Linear scale is completely inadequate for Visa or even Paypal-like volume. So that's the main problem. The primary exponential scaling methods being proposed (payment channels and sharding) are nowhere near ready for production, but at least we have a spec for the Lightning Network now.

We should be thankful: if the technology and ecosystem were mature already, we wouldn't be able to buy at such a discount.

This is pretty typical. I had a support ticket back in August (when things were much calmer), and they sent 3 unrelated boilerplate answers at first. I kept pushing to get a real human being. When I finally got one, he misunderstood my issue and gave me another boilerplate answer. I imagine things are much worse now that 100k new users a day are signing up.


It's pretty annoying that they require webcam or mobile camera for this. Built-in webcams never provide good enough quality for verification. I think this is the most typical problem, and something I struggled with a few months back. If you haven't used the mobile app with your smartphone camera to verify ID, I suggest doing so.

Throwing my hat in the ring. I'll change my signature right away if accepted.

Username: squatter
Post Count: 616
BTC Address: 14crFHpasgd72VcBeNCHHMiwafJurnEUwE

Each exchange carries a different risk profile and also has different features. For example, Gemini and GDAX are highly compliant. They are licensed wherever they operate. After the BTC-e takedown in July for money laundering and unlicensed money transmission, this is relevant. They are considered the safest US exchanges for that reason.

But they also don't support many coins for trading -- just BTC, LTC and ETH. That's why people turn to exchanges like Bittrex, Kraken and Poloniex. Altcoins are the main reason why all these exchanges exist. The ones you mentioned are the upper-tier exchanges. There are all sorts of small exchanges like Mercatox and Novaexchange which specialize in new and low-market cap coins.

Downside volatility is inevitable in a parabolic rally. Price moves far and fast on low liquidity, and once the music stops: shorts have already been squeezed/margin called, short term speculation dries up, and long term investors are waiting far, far below near the long term trends.

In particular, the mom and pop variety of investor that is entering the market now is prone to panic. The crash will come eventually, although I doubt we'll see sub-$3000 coins again. If we do, it won't be for long. I'm glad I haven't sold any coins, but I also have some fiat money waiting to enter the market for the long term. And it won't be up here above $17,000.

To be fair, Friedman LLP did release a statement about Tether. They verified that banks were held in Tether's name in the amounts of outstanding USDT. They couldn't technically verify Bitfinex's access to the accounts or other obligations, but I don't think we should assume insolvency. They are rightly worried about regulatory action and are in a serious pickle, but that's a different discussion.

Also, I've been watching the exchange price action closely. Coinbase/GDAX has been leading Bitfinex significantly during upward spikes, suggesting that it isn't Tether that's pumping the price. And if you look at Tether's circulating supply, it's silly to think it could singlehandedly prop up the entire market.

There is something to be said for denominating fees in dollar value while Bitcoin rises in price. All else equal, a rising price will increase the dollar-denominated fees. I think we should discourage calculating fees in dollars, particularly if we are trying to transition to a bitcoin-denominated economy.

But indeed, the bitcoin fee rates have significantly increased. Priority fee rates are up ~ 3-4x over recent lows over the last month. I was paying 5-10 satoshis/byte a few weeks ago and I've had to increase more than 10-fold to get reliable confirmations within 24 hours. Over this period of time, that's not natural growth. It's a spam attack.

My understanding from the report is that they are prohibiting banks/financial institutions from engaging in any cryptocurrency activities (including speculation), as well as foreigners and minors from trading on the exchanges. They are also clamping down on virtual bank accounts, which could arguably be used to evade taxes and AML/KYC regulations.

They already banned margin trading and ICOs a few months back. I'm not sure about derivatives specifically, but since financial institutions are barred from engaging with cryptocurrency, legal derivatives on regulated Korean markets seem to be off the table.

They're definitely not banning bitcoin, and they seem to be taking a softer stance towards exchanges than China.

It seemed like a pretty solid idea to me as a utility token, but the arguments from the SEC make me think they are now taking a conservative stance vis-a-vis utility arguments. Indeed, it's obvious that the promises of future returns were the "smoking gun" in this case, from looking at the SEC order:


That's pretty egregious stuff. Unfortunately, the SEC went for the easy kill, so we can only glean so much from this regarding precedent.

All in all, this isn't what I had feared. I honestly thought it might be another "China bans bitcoin" situation, given their abrupt prohibition of ICOs in September and the overall insanity of the Korean crypto markets. The regulation of cryptocurrency exchanges was fully expected at this point.

I find this interesting, though:

The ban on minors trading cryptocurrencies is no surprise; I'm surprised there weren't already laws in place that prevented that.

But it's interesting that the government is doubling down on prohibiting "banks from engaging in any cryptocurrency activities" at a time when regulated institutional-level futures markets are launching in the US. The Korean government is obviously trying to clamp down on speculation.

He's not entirely wrong from a technical standpoint. Anyone who trades the equity or commodity markets has experienced this kind of parabolic trend. The typical end to a parabolic rally is indeed a blow-off top -- a vertical rise and subsequent decline in price. In general, traders look for a 50% or greater price correction.

Like him, I suspect that BTC is headed for a blow-off. But while many analysts (who don't understand Bitcoin) will proclaim that the bubble has popped and BTC is headed to zero, I believe that it's just another dip to buy. Bitcoin defies conventional market wisdom, but in the end, there are always dumps. And eventually, once cryptocurrencies have reached the top of the adoption S-curve, it won't just be a perpetual uptrend anymore.

I think that's the idea at this point, similar to rolling a small portion of your salary into a retirement account. For example, GMO (the Japanese internet conglomerate) is rolling out their options this way:


Taking a rough estimation of Japanese wages across a corporate firm, I would guess this 10,000-100,000 yen limit is something like 1-10% of monthly wages, depending on the position. Personally, it's a bit upsetting that I've had money locked in my employer retirement account for so long with no access to Bitcoin investment options. I hope we see 401k options next year.