Taking Profits on Altcoins Strategy

[eminan]

I am looking to take some profits on my altcoins after the next big pump. Need some advice if my strategy is good or not. I'm based in the US.

1. When I start to take profits from my altcoins do I just sell them on the exchange for dollars and then buy stablecoins with that? Or do I somehow trade the alts for stables? Does is matter since selling or trading them are taxed for capital gains regardless?

2. Once I take the profits in stablecoins, is putting them on something like Blockfi to gain interest the best thing to do while I wait for another dip to possibly reinvest them?

3. Once the bull run is over I'm most likely going to keep all my bitcoin and probably most of my Ethereum. I'll sell most of my alts for stablecoins but keep small bags of the ones I want to keep through the bear market. Is this a sound strategy?

4. During the bear market is taking a cash loan using my crypto as collateral (BTC and ETH) a good way to defer capital gains taxes? Won't I have to pay these taxes eventually? I know there are drawbacks to this strategy but it seems like a lot of experienced people do this.

5. After the bull run should I just put my stablecoins in something like Blockfi during the bear market? Or is cashing out to dollars and investing in something like real estate a good way to defer capital gains taxes?

I know these are a lot of questions but any advice is greatly appreciated, this forum has been extremely helpful for a noob that has been in the space for about 4 months now. Thanks!

[bitmover]

I know these are a lot of questions but any advice is greatly appreciated, this forum has been extremely helpful for a noob that has been in the space for about 4 months now. Thanks!

I will try to help you.

I think the main problem with your strategy is that you have already traced what will happen in the next few months:
Altcoin season, then you take profits in USD, then it comes a bear market, you will put in blockfi.....

You need to consider different scenarios, as we don't know if we are even going to have an altseason like before, or even a so hard bear market. Are you ready for a different scenario like a Bitcoin bull run and altcoins losing even more value?

1. When I start to take profits from my altcoins do I just sell them on the exchange for dollars and then buy stablecoins with that? Or do I somehow trade the alts for stables? Does is matter since selling or trading them are taxed for capital gains regardless?

Doesn't make a difference. But you can take your profits in bitcoin. I believe that you have profit in altcoins only when you have profit in altcoin x BTc ratio.

2. Once I take the profits in stablecoins, is putting them on something like Blockfi to gain interest the best thing to do while I wait for another dip to possibly reinvest them?

I think it is too risk to put them in any lending plataform. You will gain 5-10% per year... that is very little in comparinson to 1000% gains bitcoin can still have in the next years, and you risk losing it all.

3. Once the bull run is over I'm most likely going to keep all my bitcoin and probably most of my Ethereum. I'll sell most of my alts for stablecoins but keep small bags of the ones I want to keep through the bear market. Is this a sound strategy?

Certainly. Bitcoin has better perfomance in long term compared to altcoins (in general, few random exceptions). I would consider keeping a hug amount  of bitcoin now, at least 50%. Even in a bull market, as altcoins usually lose in AltcoinXBTC ratio in long term.

4. During the bear market is taking a cash loan using my crypto as collateral (BTC and ETH) a good way to defer capital gains taxes? Won't I have to pay these taxes eventually? I know there are drawbacks to this strategy but it seems like a lot of experienced people do this.

5. After the bull run should I just put my stablecoins in something like Blockfi during the bear market? Or is cashing out to dollars and investing in something like real estate a good way to defer capital gains taxes?

It depends on your country regulations and laws. In Brazil you don't need to pay taxes if you sell less than 5k USD per month. Additionally, if you are just holding in the bear market you don't have to pay any tax.

Dont worry about taxes in the bear market, just try to survive.

[joniboini]

2. Once I take the profits in stablecoins, is putting them on something like Blockfi to gain interest the best thing to do while I wait for another dip to possibly reinvest them?

If you want something like 5% interest for a month or so, you can try something like yield.credit. It is a P2P lending platform running on Ethereum for now, so you don't need to rely on a centralized party (but you have to rely on smart contracts and stuff like that). It is definitely a risky play, so I don't suggest using all of your money for that. Diversify for a bit and select or create offers that match your risk profile. On top of that, it is full P2P for now, so you have to manually find and accept a borrow request. It definitely has some issues but if you can get a deal on it, you can get decent profits.

5. After the bull run should I just put my stablecoins in something like Blockfi during the bear market? Or is cashing out to dollars and investing in something like real estate a good way to defer capital gains taxes?

Why not both? Diversify your profits into several bags so you don't have to rely on a single asset.

[odolvlobo]

Your strategy is complicated. My suggestion is to stick to a simple strategy: buy bitcoins and hold them for the long term.

As for the tax questions, As a citizen or resident of the U.S., you must pay taxes any time you convert a coin to dollars or another coin. There are no tricks that can avoid it or delay it.

[Husires]

I am looking to take some profits on my altcoins after the next big pump. Need some advice if my strategy is good or not. I'm based in the US.

All users from the United States should avoid making many profitable trades in digital currencies and content themselves with trying to make losses, but with Bitcoin since many profit-making operations are taxed.
If you do not calculate your taxes correctly, 40% of these profits will end up zero.

[batang_bitcoin]

Your strategy is complicated. My suggestion is to stick to a simple strategy: buy bitcoins and hold them for the long term.

I agree, you're doing a lot of things and putting yourself into more complicated things which you can simplify it. You're going to miss a lot if you're putting it on stable coins and you're going to put that on blockfi or any of the same.
You're not thinking of a higher risk that your funds might be compromised because you're not the one who holds it. Instead of getting it into stable coins, use it to buy bitcoin and hold it on your own.

[ololajulo]

Your strategy is complicated. My suggestion is to stick to a simple strategy: buy bitcoins and hold them for the long term.

As for the tax questions, As a citizen or resident of the U.S., you must pay taxes any time you convert a coin to dollars or another coin. There are no tricks that can avoid it or delay it.

Longterm is a relative period, It is not the smartest decision to hold coin through the parabolic market of bullrun for another time. Taking profit as such period is to reallocate fund to buy from the dip and have bigger position. Technical Analysis should have been the best tool to determine when to take profit but it has so much dissappointed to pick the peak of the market and allow exiting early. I prefer a staggered form of taking profit all through the market to buy into other coins and stable coin

[tatalin]

I suggest taking profit when alts season comes because when it is over, their prices will go down and Bitcoin will again dominate the market. And wait for bear market again because all coins will be definitely at a bargain sale that time including Bitcoin.

[Dexion]

Taking profit during the altcoins season is the best choice, because if the season is over, we will see a lot of coins wasted and experiencing a downturn, and in the end only coins that are stable will dominate.

[ipanks]

I make it simple for you. When you want to take profits from your altcoins, you can take profit in bitcoin and hold it. You do not have to take profit in stable coin or usdt because you can not see the increase of the value in usdt instead, you can sell your altcoin using pair bitcoin. But if your reason to sell your altcoin in usdt is that you want to buy bitcoin in a downtrend, that can work if the downtrend happens. But I prefer to profit in bitcoin, so when the bitcoin price increases so high, the value of your stable coin will also increase. But that is up to you.

[Beparanf]

This is the common dilemma of crypto traders why the majority of traders suffers a huge loss due to greediness on taking profit. Taking profit the ultimate goal why people wants to trade so taking some in to a fiat not bad even the price continues to pump after you convert. The price will correct soon and you might re-enter. The only strategy that you should is to take profit in part.

[bison]

Taking profit during the altcoins season is the best choice, because if the season is over, we will see a lot of coins wasted and experiencing a downturn, and in the end only coins that are stable will dominate.

but a trader and investor sometimes cannot be that easy. They plan from scratch but when the market makes them greedy they will forget all the planning they made.
panic feelings sometimes save us from difficult situations. because we can sell or buy assets according to the plan we make and do not expect more.

[lionheart78]

Your strategy is complicated. My suggestion is to stick to a simple strategy: buy bitcoins and hold them for the long term.

This is the safest way(holding BTC) at least but the least profitable route along the span of time.  Taking advantage of the altcoin surge brings more profit than holding Bitcoin in a long term.  Diversify and never stop trading to maximize the potential profit.  Investing only in Bitcoin and holding it for a long time means you are sleeping your coins while waiting for the possible profit of BTC to doubles or triples its value in the future.  But investing (short term) it on different altcoins (as long as you don't get busted) can give you a possible profit of more than 100x the profit you take on just holding BTC.

[laredo7mm]

When alt season is running why don't you take the chances. Investing money into alts and convert them into USD when alt season is over is a good idea. This will increase your portfolio but my suggestion will be looks for the long run. For the long run BTC, ETH, BNB, DOT is the real deal and this could give your more benefits than other alts so far.

[kak uli]

I am looking to take some profits on my altcoins after the next big pump. Need some advice if my strategy is good or not. I'm based in the US.

1. When I start to take profits from my altcoins do I just sell them on the exchange for dollars and then buy stablecoins with that? Or do I somehow trade the alts for stables? Does is matter since selling or trading them are taxed for capital gains regardless?

2. Once I take the profits in stablecoins, is putting them on something like Blockfi to gain interest the best thing to do while I wait for another dip to possibly reinvest them?

3. Once the bull run is over I'm most likely going to keep all my bitcoin and probably most of my Ethereum. I'll sell most of my alts for stablecoins but keep small bags of the ones I want to keep through the bear market. Is this a sound strategy?

4. During the bear market is taking a cash loan using my crypto as collateral (BTC and ETH) a good way to defer capital gains taxes? Won't I have to pay these taxes eventually? I know there are drawbacks to this strategy but it seems like a lot of experienced people do this.

5. After the bull run should I just put my stablecoins in something like Blockfi during the bear market? Or is cashing out to dollars and investing in something like real estate a good way to defer capital gains taxes?

I know these are a lot of questions but any advice is greatly appreciated, this forum has been extremely helpful for a noob that has been in the space for about 4 months now. Thanks!

If indeed your country already has government regulations on virtual currencies I think it is an opportunity for you to take cash loans from several banks with collateral using (BTC and ETH). at least the loan that you take can be used as capital to trade in altcoins which have low prices. and that you can do if in your country there are regulations from the government regarding virtual currencies. I think it is a brilliant idea for you to share

[bocyaj]

I suggest taking profit when alts season comes because when it is over, their prices will go down and Bitcoin will again dominate the market. And wait for bear market again because all coins will be definitely at a bargain sale that time including Bitcoin.

After a huge fall in the price of bitcoin,some people had loss their trust on bitcoin. It's especially for the new investors and traders.Take this as a advice. The price is just a number, if you inverse on bitcoin and hold over a period of one year. Their may be a miracle happens. So holding is essential one in bitcoin to get profit.

[Asgard124]

I am looking to take some profits on my altcoins after the next big pump. Need some advice if my strategy is good or not. I'm based in the US.

1. When I start to take profits from my altcoins do I just sell them on the exchange for dollars and then buy stablecoins with that? Or do I somehow trade the alts for stables? Does is matter since selling or trading them are taxed for capital gains regardless?

2. Once I take the profits in stablecoins, is putting them on something like Blockfi to gain interest the best thing to do while I wait for another dip to possibly reinvest them?

3. Once the bull run is over I'm most likely going to keep all my bitcoin and probably most of my Ethereum. I'll sell most of my alts for stablecoins but keep small bags of the ones I want to keep through the bear market. Is this a sound strategy?

4. During the bear market is taking a cash loan using my crypto as collateral (BTC and ETH) a good way to defer capital gains taxes? Won't I have to pay these taxes eventually? I know there are drawbacks to this strategy but it seems like a lot of experienced people do this.

5. After the bull run should I just put my stablecoins in something like Blockfi during the bear market? Or is cashing out to dollars and investing in something like real estate a good way to defer capital gains taxes?

I know these are a lot of questions but any advice is greatly appreciated, this forum has been extremely helpful for a noob that has been in the space for about 4 months now. Thanks!

Taking profit is very important strategy on Altcoins. Most importantly also is to know the best time to take profit. Also, cultivate the habit of not emptying your entire portfolio.

[naikturun]

You have a lot of strategies, because most of you might be confused about which one to use, I always use a strategy before buying to determine the target to be achieved so it won't be a headache to take advantage or in how long you will hold it
staking or farming can produce bigger returns than stable coins you have to try it but the risk is greater you need to deepen it before investing.
Even if history will repeat, chances are it will not be exactly the same you cant use same strategy over and over, make a new one or follow market condition.

[target]

Sell for USDT and just keep the USDT until there will be another bull market and then start buying again when the bull market starts. When bear market is here, all the coins are going to dip for months to years and holding BTC will not be recommended.  You will have to watch the market every time because the bull run today might take more than a year actually so don't hurry upon reaching your price target, it may just be the lowest as possible.

[jacafbiz]

I think your strategy is too complicated for new investors, what I advice is simple, take one-third of your investment out when the coin do 3X to 5X and let the rest run to 10X and take more out, by doing this you will have your investment back and sit in profit. For bear market learn how to hedge yourself and short the market, this is where the profit is because they there will be a lot of stupid money still sitting around and waiting to be scooped