Cryptocurrency mega-thread

[juss]

What do you mean by “work”?

If you mean will you make money, then yes. If you can pick the ones that will rise and then trade for profit then go for it.

If you mean will this somehow allow you to avoid paying tax on part or all of your trades then the answer probably depends on a few things;
1. Does the exchange you’re using keep records that may be audited by the ATO in the future? If they have a transaction history feature and have an ABN then I’d say yes and yes.
2. Will the ATO audit you? Maybe not, particularly if it’s relatively small figures. But be aware that where $AUD and Aussie bank accounts are involved they have visibility. And I’m certain they have the ability to filter on money going in/out of the crypto exchange sites to/from Aussie bank accounts. And no doubt it will be an area they will be cracking down hard on - with the power to go back and audit previous years too.

Your bank keeps records.
The exchanges keep records.
Many cryptos are public ledgers.

I’d suggest it’ll be cheaper in the long term to just pay your tax or find legal ways to reduce how much tax you do need to pay.

Yeh thats what I mean. I was under the understanding that if you dont withdraw in fiat and if you just exchange crypto2crypto then tax doesnt apply?

What are other people doing? Is everyone keeping a record to give to their accountant?

 

[cryptor]

Yeh thats what I mean. I was under the understanding that if you dont withdraw in fiat and if you just exchange crypto2crypto then tax doesnt apply?

What are other people doing? Is everyone keeping a record to give to their accountant?

I’m not a tax accountant or anything like that. Just sharing what I’ve interpreted from the ATO website about it.

The ATO doesn’t currently recognise cryptocurrencies like they do fiat currencies. As far as they’re concerned they’re like shares. And for tax purposes will have CGT (Capital Gains Tax) applied.

My interpretation is that trading one crypto for another (eg. BTC for ETH rather than BTC for AUD then for ETH) are still considered separare CGT events. So you’d need to pay CGT for the profit made there (which would involve knowing or estimating the price for which it was worth when you traded it). But this also means that if you traded at a loss somewhere you could deduct that from a profit elsewhere - which is good if you happen to make a loss somewhere.

Of note is that if you hold the asset for less than 12 months (which would be the case if you’re day trading) then you’ll pay CGT on 100% of the profit. But if you hold it for 12 months or longer you’ll only have to pay CGT on 50% of the profit. The latter is my plan for paying less tax on my longer term investments in XRP and ETH.

There is one last scenario that involves no tax being paid and that is if the crypto is purchased as a personal use asset. There’s a bunch of requirements you need to meet to qualify for this like that it needs to be under $10k worth, needs to have been purchased exclusively for use as a currency (ie. You got some BTC because you specifically wanted to buy something with BTC). But it’s not clear to me what all the conditions are here as I’m sure like me you’ve already got a heap of ideas about how this could be exploited. So it’s likely something that is highly scrutinized.

Ultimately up to you what you do with your finances and of course what works for me might not work for you due to differing states of our finances (from a tax perspective). But yeah, I’d at least be keeping a record of your trades and discussing all this with a qualified tax agent - one who knows about the whole cryptocurrency side of things might be better, but I’m sure any good professional can interpret the tax codes.

 

[juss]

I’m not a tax accountant or anything like that. Just sharing what I’ve interpreted from the ATO website about it.

The ATO doesn’t currently recognise cryptocurrencies like they do fiat currencies. As far as they’re concerned they’re like shares. And for tax purposes will have CGT (Capital Gains Tax) applied.

My interpretation is that trading one crypto for another (eg. BTC for ETH rather than BTC for AUD then for ETH) are still considered separare CGT events. So you’d need to pay CGT for the profit made there (which would involve knowing or estimating the price for which it was worth when you traded it). But this also means that if you traded at a loss somewhere you could deduct that from a profit elsewhere - which is good if you happen to make a loss somewhere.

Of note is that if you hold the asset for less than 12 months (which would be the case if you’re day trading) then you’ll pay CGT on 100% of the profit. But if you hold it for 12 months or longer you’ll only have to pay CGT on 50% of the profit. The latter is my plan for paying less tax on my longer term investments in XRP and ETH.

There is one last scenario that involves no tax being paid and that is if the crypto is purchased as a personal use asset. There’s a bunch of requirements you need to meet to qualify for this like that it needs to be under $10k worth, needs to have been purchased exclusively for use as a currency (ie. You got some BTC because you specifically wanted to buy something with BTC). But it’s not clear to me what all the conditions are here as I’m sure like me you’ve already got a heap of ideas about how this could be exploited. So it’s likely something that is highly scrutinized.

Ultimately up to you what you do with your finances and of course what works for me might not work for you due to differing states of our finances (from a tax perspective). But yeah, I’d at least be keeping a record of your trades and discussing all this with a qualified tax agent - one who knows about the whole cryptocurrency side of things might be better, but I’m sure any good professional can interpret the tax codes.

Are people keeping a record of all their transactions or just letting the exchanges do that for them?

 

[StringyDog]

Are people keeping a record of all their transactions or just letting the exchanges do that for them?

Depends on the exchange you use as some only show you the history of eth to alt conversion for example but you need to know what eth was at time to have a proper record. I keep all my own but i am not day trading so its not a big deal for me

 

[wadistance]

any predictions on when the correction will happen? I've got 400xrp coins that I purchased @ 30c and I'm thinking of getting out soon, waiting for the crash and then coming back in. Around $3.40 is what I want to get out at. I'm hoping it nosedives big after that

 

[WeetBixKid]

I’m not a tax accountant or anything like that. Just sharing what I’ve interpreted from the ATO website about it.

The ATO doesn’t currently recognise cryptocurrencies like they do fiat currencies. As far as they’re concerned they’re like shares. And for tax purposes will have CGT (Capital Gains Tax) applied.

My interpretation is that trading one crypto for another (eg. BTC for ETH rather than BTC for AUD then for ETH) are still considered separare CGT events. So you’d need to pay CGT for the profit made there (which would involve knowing or estimating the price for which it was worth when you traded it). But this also means that if you traded at a loss somewhere you could deduct that from a profit elsewhere - which is good if you happen to make a loss somewhere.

Of note is that if you hold the asset for less than 12 months (which would be the case if you’re day trading) then you’ll pay CGT on 100% of the profit. But if you hold it for 12 months or longer you’ll only have to pay CGT on 50% of the profit. The latter is my plan for paying less tax on my longer term investments in XRP and ETH.

There is one last scenario that involves no tax being paid and that is if the crypto is purchased as a personal use asset. There’s a bunch of requirements you need to meet to qualify for this like that it needs to be under $10k worth, needs to have been purchased exclusively for use as a currency (ie. You got some BTC because you specifically wanted to buy something with BTC). But it’s not clear to me what all the conditions are here as I’m sure like me you’ve already got a heap of ideas about how this could be exploited. So it’s likely something that is highly scrutinized.

Ultimately up to you what you do with your finances and of course what works for me might not work for you due to differing states of our finances (from a tax perspective). But yeah, I’d at least be keeping a record of your trades and discussing all this with a qualified tax agent - one who knows about the whole cryptocurrency side of things might be better, but I’m sure any good professional can interpret the tax codes.

I'm pretty sure you're not entitled to claim a tax deduction if you make a loss though. Hopefully they keep it simple & the only time it's a taxable event is when you change to fiat.

Reading the ATO website this stood out:

https://www.ato.gov.au/General/Gen/...rrencies-in-Australia---specifically-bitcoin/

Transacting with bitcoin
Transacting with bitcoin is akin to a barter arrangement, with similar tax consequences. Our view is that bitcoin is neither money nor a foreign currency, and the supply of bitcoin is not a financial supply for goods and services tax (GST) purposes. Bitcoin is, however, an asset for capital gains tax (CGT) purposes.

You need to keep the following records for bitcoin transactions:

• the date of the transactions
• the amount in Australian dollars (which can be taken from a reputable online exchange)
• what the transaction was for
• who the other party was (even if it’s just their bitcoin address).

Is this privacy issue what coins like Monero are addressing?

 

[SizeMatters]

any predictions on when the correction will happen? I've got 400xrp coins that I purchased @ 30c and I'm thinking of getting out soon, waiting for the crash and then coming back in. Around $3.40 is what I want to get out at. I'm hoping it nosedives big after that

I was shitting bricks when I stupidly dropped another 10k into XRP when it dipped to $3 a few days go (from 3.50) and then it corrected to ~$2.30s or so? Going to get out soon I reckon but only after I squeeze a few more $s out of it. Not sure what to move into next though. I'm just limited in what I can invest into since only the single exchange (BTC Markets) has accepted my verification.

 

[badbeats]

Just waiting for my letting for BTC Markets and I'm going to do some dabbling with some altcoins

Won't be investing heaps, just a bit of speculative stuff. Anyone suggest any guides or things to look for when scouting the market?

 

[wadistance]

I was shitting bricks when I stupidly dropped another 10k into XRP when it dipped to $3 a few days go (from 3.50) and then it corrected to ~$2.30s or so? Going to get out soon I reckon but only after I squeeze a few more $s out of it. Not sure what to move into next though. I'm just limited in what I can invest into since only the single exchange (BTC Markets) has accepted my verification.

the annoying thing on binance is that the best way to trade is with ether - which means you really gotta go big on that when it drops.

I've done a bit of alt trading now, slowly building my portfolio through SUB and QSP so far

 

[jezzajay]

I was shitting bricks when I stupidly dropped another 10k into XRP when it dipped to $3 a few days go (from 3.50) and then it corrected to ~$2.30s or so? Going to get out soon I reckon but only after I squeeze a few more $s out of it. Not sure what to move into next though. I'm just limited in what I can invest into since only the single exchange (BTC Markets) has accepted my verification.

Some options to consider (that I like) that are cheaper... SUB, SONM, SC, GNT, VEN, DGB, BAT, POWR, CVC, FUN, VTC, QSP... to name a few
Make sure you do your research..

 

[Chubberson]

Going to have to rename all exchanges Pamplona and the Crypto boom as tge running of the bulls. This shit is lol knee slapping goodness.

 

[cryptor]

I'm pretty sure you're not entitled to claim a tax deduction if you make a loss though. Hopefully they keep it simple & the only time it's a taxable event is when you change to fiat.

Reading the ATO website this stood out:

https://www.ato.gov.au/General/Gen/...rrencies-in-Australia---specifically-bitcoin/


Is this privacy issue what coins like Monero are addressing?

Not a tax deduction. Offsetting a capital loss against a capital gain.

If you were to invest in a crypto and sell it at a loss and that’s all you did then that would be too bad so sad. A loss you’d have to wear and you wouldn’t be able to deduct that from say your income tax like you might an expense made for a work item.

But say you make a $1000 profit on one crypto (ie. It’s a realised profit because you’ve sold it off for another crypto or fiat) but then you don’t do so well on another crypto and actually make a $300 loss. You would be able to deduct that from the $1000 profit earlier in that same FY and only have to pay tax on $700 profit.

But again, don’t take my word for it. Seek your own professional tax advice.

 

[funk44]

My stellar has tripled in value in about 2 days...

 

[cryptor]

Are people keeping a record of all their transactions or just letting the exchanges do that for them?

The exchanges I’m using do a good enough job recording that info for me. Coinspot though allows you to trade between various coins so that’s where I might need to take notes. But a rough price estimate can be achieved looking at historical charts.

 

[jezzajay]

Btc markets tweeting that backlog of BPay deposits will be in by tomorrow.

 

[ash_1050]

I was shitting bricks when I stupidly dropped another 10k into XRP when it dipped to $3 a few days go (from 3.50) and then it corrected to ~$2.30s or so? Going to get out soon I reckon but only after I squeeze a few more $s out of it. Not sure what to move into next though. I'm just limited in what I can invest into since only the single exchange (BTC Markets) has accepted my verification.

Leave it in XRP until the end of the month when the Coinspot announcement is suspected to take place. Just trust me and thank me later.

 

[jezzajay]

Leave it in XRP until the end of the month when the Coinspot announcement is suspected to take place. Just trust me and thank me later.

Coinspot or coinbase?

 

[ash_1050]

Coinspot or coinbase?

Coinbase*

A too many coin related companies out there these days. Back in my day we only had one and we were damn lucky to have it.

 

[jezzajay]

Coinbase*

A too many coin related companies out there these days. Back in my day we only had one and we were damn lucky to have it.

Do you believe it will happen? Don’t get me wrong, I’d love to see it come fruition...I see so many conflicting news/rumours that I can’t be confident either way.

 

[maryjames]

Jumped back on ripple.. great move.

Get on litecoin the next few days.. it’s about to go up. I’ve got absolutely no reason why I think this. Just my gut.

 

[ash_1050]

Do you believe it will happen? Don’t get me wrong, I’d love to see it come fruition...I see so many conflicting news/rumours that I can’t be confident either way.

It will happen. If it wasn't going to happen Coinbase would have said 'no we're not listing XRP' instead of running a poll asking what crypto do you want to see added to Coinbase and XRP topping the poll (once you remove the winner which was done via bot spamming).

 

[Summer Nights]

It will happen. If it wasn't going to happen Coinbase would have said 'no we're not listing XRP' instead of running a poll asking what crypto do you want to see added to Coinbase and XRP topping the poll (once you remove the winner which was done via bot spamming).

They probably spammed it themselves to throw their employees off the scent. Imagine the effort going into preventing insider trading. It would be bloody hard to stop.

 

[typeclub]

Another day in crypto where my portfolio has risen in value and earnt me 3x more than my day job However i dont like to mention those red days hehe.

Noticed a few people talking about how to reduce tax on their crypto earnings when the time comes. I hope to God i have that problem 18-24 months from now. Its a good problem to have. Until then i wont worry about it and just focus on increasing my profits.

Do you know any places to buy Gold with Bitcoin online or maybe Monero?

 

[typeclub]

Btc markets tweeting that backlog of BPay deposits will be in by tomorrow.

I did a BPay yesterday when they had 4700 backlog and it was in the account by this morning.

 

[maryjames]

any predictions on when the correction will happen? I've got 400xrp coins that I purchased @ 30c and I'm thinking of getting out soon, waiting for the crash and then coming back in. Around $3.40 is what I want to get out at. I'm hoping it nosedives big after that

Hold. Hold .. hold.