Can money flow from crypto into fiat in large amounts? I don't think so.

[leopard2]

My theory is that crypto will have to recover sooner or later because money is not really leaving exchanges.

Think about it: unless you are a whale with lots of money and good connections (lawyer, tax advisor, bulk trader et cetera) how do you get the money out?

For small fishes it may be possible and maybe for well connected whales, but for the majority of coin market cap it is not possible. In the US there is taxes and an unfair Justice system with civil forfeiture. In the EU you have taxes, social security, health insurance...and a political system that does not respect property. China, India, I don't even want to think about where people could end up with lots of fiat showing up in their bank account.

On top of all that is exchanges that seize, freeze or get hacked all the time.

People report getting into all sorts of trouble when cashing out (Bitcointalk, reddit) so I think if someone would really have large amounts of money in crypto, there is no way to get out. If the exchange does not freeze it, the bank will, if the bank does not freeze it the taxman or authorities will.

So my theory is, crypto always recovers because the fiat stays in the system and is re-invested sooner or later, plus all the new fiat flowing into the system

Just a theory. Are there any numbers about the actual CASH FLOW in/out of crypto?

The fact that USDT market cap goes up all the time, speaks for my theory too.  

So no worries we are going up again!  

https://coinmarketcap.com/assets/tether/

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[gentlemand]

Anyone with a significant amount of crypto profit and a modicum of sense should be selling OTC.

I certainly would not trust any exchange with large sums. And I wouldn't trade any alt into large sums. I'd dribble it and only places that worked properly.

There are enough reputable brokers like Grayscale and Cumberland Mining. I assume there are some for ETH too, but not any other alt.

As for the banking bit, I'd sound my bank out first. If they had a problem I'd take my business elsewhere.

[Torque]

OP, your theory is probably closer to the truth.

What most new crypto enthusiasts don't realize, is that whale market makers initiate both bull markets and bear markets. And who are the whale MMs? Most would be surprised to know that owners of the large exchanges themselves are likely trading on their own exchanges, along with major mining operators -- playing both sides of the trade, front running, etc.

They sell their excess coins to public traders and investors during a bull market on the way up for fiat. And then during a bear market, they short the market on the way down buying the same coins back from weak hands (for much less). In doing so, hardly any real money moves from the exchanges' own credit accounts.

[freebutcaged]

Don't you know it by now? cryptocurrencies are another name for pump and dump, we're only seeing the surface while deep within it's more

Complicated than that, you don't need to dump for the price to go down, all you need to do is to make others to dump so you could enter and

Buy then start the accumulation, this is what whales are doing, accumulating fiat to buy more coins. newbies are doing it for them by panic selling.

[Pente]

I don't see any need to ever cash out large amounts for fiat. My intention is just to eventually cash out a small amount every month.

I am seriously considering retiring in Kenya, I can easily cash out about $1000 every month using Bitpesa. With that much money I can get a nice apartment with a pool, a maid, and anything I need. I can cash out a little extra if I want a nice TV or something.

I don't feel any real need to diversify. I will soon be getting about $800/month from my Social Security. I probably won't even bother to sell my place in the USA, just give it to one of my grandkids.

I think of crypto as the best store of wealth. No upkeep, no worrying about inflation, government can't seize it. It just solves so many problems. Why would I want to move it to fiat?

That just leaves volatility.

Volatility is just part of high growth, just read Chaos by James Gleick. Any system goes into chaotic behavior when it absorbs to much energy. For crypto, this energy is money, so it has to be chaotic.

[AjithBtc]

Money flow from cryptocurrency to the fiat is quite possible when the price increase in a stable manner along with the increasing trading volume. This causes price manipulation and some even engage into artificially creating price pumps to increase the trading volume as well to gain the user attention about its increasing market capital.

[btcjocan]

Money flow from cryptocurrency to the fiat is quite possible when the price increase in a stable manner along with the increasing trading volume. This causes price manipulation and some even engage into artificially creating price pumps to increase the trading volume as well to gain the user attention about its increasing market capital.

Well that's a matter of a trader's strategies of doing price pumps, but personally I don't know how to do it because I know only a little bit of quick trades in simple ways. Anyways cryptocurrency price towards fiat will likely to increase depending on how price behaves in the same manner of how bitcoin marketplace works, because digital currency is very shaky in movement of it's price; it can even drop in large amount anytime. It's better to invest while price still cheaper rather than those trending coin price, because it comes a time you buy it a wrong timing; price will suddenly decrease afterall so you won't be able to recover profit that's why panic sells happened.

[leopard2]

I think of crypto as the best store of wealth. No upkeep, no worrying about inflation, government can't seize it. It just solves so many problems. Why would I want to move it to fiat?

That just leaves volatility.

Volatility is just part of high growth, just read Chaos by James Gleick. Any system goes into chaotic behavior when it absorbs to much energy. For crypto, this energy is money, so it has to be chaotic.

Good thinking, are you a scientist or an engineer?

I like the part about upkeep; if you have a bank account or broker account and don't babysit it all the time, you will be locked out after a few months, then it becomes dormant, high fees apply, after a few years the account will be gone for good.

And in the meantime you get enough paper all the time to heat a house with it LOL or you have to log in and download virtual paper. If you can, because the bank migrates their system all the time, new logins, devices, passwords AAAARRRRRRRRRRGHH!!!!!!!!!  

All we need now I guess are real world assets on the blockchain but Uncle Sam hates bearer instruments....

[Meuh6879]

I think of crypto as the best store of wealth. No upkeep, no worrying about inflation, government can't seize it. It just solves so many problems.

Why would I want to move it to fiat?

to pay the taxman.
that what i do since end of 2016 (i have stopped to work now).

[Pente]

I think of crypto as the best store of wealth. No upkeep, no worrying about inflation, government can't seize it. It just solves so many problems.

Why would I want to move it to fiat?

to pay the taxman.
that what i do since end of 2016 (i have stopped to work now).

I thought capital gain taxes were only applicable if you took your profits? And if you wait till you have no income, then you don't even have to file a tax return.

[botany]

I think of crypto as the best store of wealth. No upkeep, no worrying about inflation, government can't seize it. It just solves so many problems.

Why would I want to move it to fiat?

to pay the taxman.
that what i do since end of 2016 (i have stopped to work now).

I thought capital gain taxes were only applicable if you took your profits? And if you wait till you have no income, then you don't even have to file a tax return.

If you earn money (through services, trading) in the form of bitcoins, you have to pay taxes. This would be tax on income, not capital gains tax. This has to be paid in the form of fiat, to the taxman.

[xypos]

It is sort of a grey area in most countries at the moment, it is definitely possible though for someone to move large amounts of bitcoin into fiat without having to provide any sort of ID, or have any connections at all. Go to localbitcoins, and you'll see so many buyers ready to buy your bitcoin with cash.

Obviously you're taking a risk of getting tracked down by authorities but it's a relatively minor one.

I don't think that this is the reason why bitcoin isn't getting dumped back to $2000. It's because people are buying bitcoin as soon as it crashes, because they know that if they wait later there might not be more chances to do it.

[Yuuto]

My theory is that crypto will have to recover sooner or later because money is not really leaving exchanges.

Think about it: unless you are a whale with lots of money and good connections (lawyer, tax advisor, bulk trader et cetera) how do you get the money out?

For small fishes it may be possible and maybe for well connected whales, but for the majority of coin market cap it is not possible. In the US there is taxes and an unfair Justice system with civil forfeiture. In the EU you have taxes, social security, health insurance...and a political system that does not respect property. China, India, I don't even want to think about where people could end up with lots of fiat showing up in their bank account.

On top of all that is exchanges that seize, freeze or get hacked all the time.

People report getting into all sorts of trouble when cashing out (Bitcointalk, reddit) so I think if someone would really have large amounts of money in crypto, there is no way to get out. If the exchange does not freeze it, the bank will, if the bank does not freeze it the taxman or authorities will.

So my theory is, crypto always recovers because the fiat stays in the system and is re-invested sooner or later, plus all the new fiat flowing into the system

Just a theory. Are there any numbers about the actual CASH FLOW in/out of crypto?

The fact that USDT market cap goes up all the time, speaks for my theory too.  

So no worries we are going up again!  

https://coinmarketcap.com/assets/tether/

Well, your theory is definitely interetnsing to read.

However, it sort of self contradicts itself - if people holding bitcoin or are investing in bitcoin know that bitcoin is not liquid, as in your theory, then why would they buy into bitcoin, pumping up the price?

The logical thing to do is to stop buying bitcoin altogether, and dump whatever they possibdly can right? So the price rises after corrections can't be explained by your theory, or your theory alone.

As xypos said i think it's more because there is so many people trying to buy cheap coins... Floor seems to be set at $2300 in stone, two dumps have occured thus far and none have broken $2300.

[andrei56]

The real question is why anyone that became rich in bitcoin and that in his everyday life is not earning much, will want to get out of crypto, it does not make sense, someone may withdraw enough for living expenses and stuff like that but it is probably better to wait for the day crypto is more accepted than to try to cash out.

[deepcolderwallet]

The real question is why anyone that became rich in bitcoin and that in his everyday life is not earning much, will want to get out of crypto, it does not make sense, someone may withdraw enough for living expenses and stuff like that but it is probably better to wait for the day crypto is more accepted than to try to cash out.

[deepcolderwallet]

Why trade our precious BTC for stinky fiat?
You can buy a penthouse with BTC, you can buy a Lambo with BTC.
YOU CAN EVEN BUY A WHOPPER WITH BITCOIN!!!
https://news.bitcoin.com/burger-king-russia-accept-bitcoin-payments-summer/

Burger King Russia Franchise Plans to Accept Bitcoin Payments This Summer