Are you happy to pay ~30% of your profit, effectively erasing all otherwise would-be profits made from a price decrease in the range of $100 to ~$77?
Capital gain taxes are horrible, and I'm sorry for anyone being extorted that way. That being said, avoiding taxes can be a very bad investment advisor. One can easily lose a lot more in an investment than in taxes. This is again proven with bitcoin since the bubble popped. Anyone that locked in profits between $250 and $130 is ahead over holding, even after paying 30% taxes on the gains. Don't let the government interfere with your common sense to sell high and buy low. Easier said then done, I admit.
Still, the price has to fall considerable just to break even, 30% is a lot, and then you have to hand over your money to the state, which in itself leaves a bad taste in my mouth. I don't want to pay taxes so I'm trying to avoid that situation. Everytime someone pays capital gains tax that means less money in the BTC economy and more money to be used on regulation of bitcoin, it's bad for everyone.
I don't "worry" a whole lot about the underlying value, I'm holding roughly 95% in bitcoin and 5% in fiat and I sleep like a baby, and the only reason I hold any fiat at all is to buy back cheaper and increase the amount of bitcoins I own.
How can you buy considerably more btc when you only have 5% cash and 95% in btc?
This can only mean your capital is very small compared to your income. A situation I assume you want to change however going all in, even at a bottom, is very poor risk management, so chances are low that you will hold on to any capital you succeed in building up, as all-in strategies lead to ruin, sooner or later.
I understand that if your capital is low compared to your income, and your income is secure, that you are able to handle the risk to invest all your capital in bitcoin. However, if successful a switch of strategy is crucial in my opinion. Considering you have bought lots of coins during the depression of 2011, you have already 50 folded your invested capital around the recent top, but still you have not switched to an even somewhat more balanced strategy. This does not look healthy to me. I could be wrong, I'm judging based on very little information I have from your situation.
I can buy considerably more if the price drops enough, if it doesn't no, then I won't be able to increase my posision a lot, but the bitcoins I gain could still be considered a lot of money once the price goes up again, which I'm confident it will at some point. Also I don't understand how you came to the conclusion that my income is high compared to my capital, it's more like the opposite.
Well there you go, it really is that simple, more BTC is what it's all about, just like I said. USD is a means to an end.
I strongly disagree. In investment it's not about how many bitcoins, gold ounces, real estate, or stocks that you are able to accumulate. It's about how much value/purchasing power you are able to build up.
You are thinking like a gold bug, or real estate bug, or stock bug. Sooner or later a decades long bear market arrives and they lose most of their purchasing power. At least they can say that it will go up again sometime in the future (though since it can take decades they might not be there anymore to experience it). With bitcoin nothing of the kind! Hard to imagine now but bad news can come in strides and a combination of development disagreements, outlawing by some major government and competition can seal the faith of bitcoin. So being a bitcoin bug is even more irrational as you cannot say with any historical certainty that if will come back sooner or later.
I'm sorry for being so confrontational but honestly I'm stunned to see this typical bitcoin bull talk still expressed today after the market proved you so wrong. Either I am missing something here or you are.
I believe in bitcoin, I believe the price will raise considerably the next 5 years. For me the only rational thing is to hold as many BTC as I can. I've been through bubbles before and it didn't make me sell out at the bottom, just like i didn't sell out on the top. There are two reasons why:
1. I'm a long term investor, I don't mind holding for years. I don't trade much, most traders lose in the long run.
2. I don't want to sell more than the maximum I can before being eligible for capital gains, something I refuse to pay.
What's stupid about buying bitcoin with the intention of holding for 5-10 years? The market hasn't proved me wrong at all, it's just as expected. Up and down up and down, you're clearing missing something here, you think like a trader, not investor.
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