Are members invested in Bitcoin/crypto?

Archer · Mar 31, 2021

Can’t answer your question, but I do know that CRA (like your IRS) is forcing exchanges to turn over user data so they can track illegal activity and ensure that taxes are being paid properly.

dsio · Mar 31, 2021

Archer
Can’t answer your question, but I do know that CRA (like your IRS) is forcing exchanges to turn over user data so they can track illegal activity and ensure that taxes are being paid properly.

In Australia the two guys I know that are really into crypto both got audited by the ATO last year, luckily both were smart enough to be fully honest in their disclosure but the tax office were like yea we’re targeting crypto traders because its an extremely cost effective enforcement approach given how many aren’t paying tax.

Walrus · Mar 31, 2021

Archer
Can’t answer your question, but I do know that CRA (like your IRS) is forcing exchanges to turn over user data so they can track illegal activity and ensure that taxes are being paid properly.

In our tax return the IRS now asks directly if you have made profit with cryptocurrency. And like your country the major exchanges are required to report account info. It used to only trigger at 10k but they have clarified the laws and now all crypto gains are taxable. Even purchases of items with crypto profits are taxable. It’s ok I mean that’s what we do right, pay taxes. It will be a major headache to try to figure out as I DCAd over a period of time but it’s not like I’m rolling in the stuff anyway, just had an interest way back when. Now I talk to people who just recently got in and they are trading it constantly. I ask them what they do about taxes, they lay out this elaborate scheme they go through to “hide” their profits. I keep my mouth shut as I’m not going to lecture anyone but damn I don’t think they realize they are opening the door for all kinds of fines, audit and who knows what else. I don’t know how it is in Canada but if you get audited by the IRS I hear it’s an incredibly stressful situation to deal with. I will gladly pay them to leave me alone.

Dries · Apr 1, 2021

I'm sure it's easy to *hide* your profits as long as you don't cash out, that doesn't make it legal.

Overhere in Belgium, we don't really pay taxes on passive investment income (no capital gains tax) but a few years ago they started claiming any earnings from virtual currencies are by definition "highly speculative" and thus taxable at 33%

Archer · Apr 1, 2021

Walrus
I don’t know how it is in Canada but if you get audited by the IRS I hear it’s an incredibly stressful situation to deal with. I will gladly pay them to leave me alone.

CRA here doesn't have quite the same reputation that the IRS does, but the IRS is known for being particularly nasty I think.

People here are well aware of the IRS, as the US is I believe the only country in the world that taxes based on citizenship, rather than residence (so much for "no taxation without representation"). The US and Canada (not sure about other countries) have signed agreements that force banks to turn over financial data to the IRS for those who are US citizens living here - either US only citizens living here or dual citizens, of which there are many - I know of two living on my street here for example.

For the most part US citizens get credit from the IRS for the taxes they pay to the CRA. The problem comes when there are differences in the type and level of deductions that are allowed in the two systems. This has lead many residents here with US citizenship being retroactively taxed by the IRS on something that is not taxable here. This, and the last administrations "tax repatriation" act has lead to large and unexpected tax bills since this agreement was signed, and many dual citizens have renounced their US citizenship as a result.

Walrus · Apr 1, 2021

Dries
I'm sure it's easy to *hide* your profits as long as you don't cash out, that doesn't make it legal.

Overhere in Belgium, we don't really pay taxes on passive investment income (no capital gains tax) but a few years ago they started claiming any earnings from virtual currencies are by definition "highly speculative" and thus taxable at 33%

Well we aren’t responsible for taxes on unrealized gains so that is not an issue. These traders I know are deliberately burning wallets on realized gains, that, IMO is playing with fire. The current administration is proposing taxing unrealized gains but that’s just talk at the moment and I’m not trying to veer off on which party or administration does what to whom when it comes to taxes as IMO they are all equally messed up. I actually had an issue when my wife and I received some property in China when her father passed away. It is illegal for US citizens to own property in China. That was quite a headache. We received some very threatening letters from one of China's embassy’s and had to go to NYC to straighten the whole thing out. I have a hard enough time trying to figure out my own countries tax laws and I could say many negative things about them, no way could I speak with any true knowledge on other countries, I just hope everyone is treated fairly for the most part.

eugeneandresson · Apr 1, 2021

Walrus
Bitcoin hit a 1.12 trillion dollar market cap. I got a buddy in Toronto he is a big crypto guy he is telling me Btc market cap is now greater than the supply of Canadian loonies or Canadian dollars in circulation.

...and to keep it all alive, the network uses more power than the whole of Switzerland ... for nothing more than the (now archaic) mechanism of how it works 🤦

Walrus · Apr 1, 2021

eugeneandresson
...and to keep it all alive, the network uses more power than the whole of Switzerland ... for nothing more than the (now archaic) mechanism of how it works 🤦

Compare it to the kilowatt hours of the US banking system. You will be surprised. And when we hear “more power than Switzerland” what does that mean. Does that include gas, natural gas, solar, windmills, eighteen wheelers? Most of the time they say Switzerland and a couple other countries. And mind you I am not saying btc is efficient, actually the white papers discuss the problems with its energy consumption and the hope that as it became widely adopted people would smarten up and find efficient means of mining it. Look what gold mining is doing to the waters of South America, never hear to many complaints about that. Yes a fault of bitcoin is it’s use of energy, but with all things it’s good to look at the whole picture. Btc will have a max supply of 21 million coins we are already around 18 million or so. When will the fed, the banking and gold mining stop. bitcoin is not energy efficient, I just wonder why the media picks and chooses things the way they do. Everyday I get mailings from banks asking me if I want loans, credit cards or the next great investment. How many trees are they cutting down for that. I have yet to receive anything from the btc foundation, at least they leave the trees alone

Archer · Apr 1, 2021

Walrus
Compare it to the kilowatt hours of the US banking system.

Well, if you are concerned with unequal comparison, this is one here. Unless you are claiming that crypto is equal in economic activity to the whole US banking system, which seems unlikely.

If there is a comparison of how much energy is consumed by the equivalent amount of economic activity from each, that would be good to see.

Walrus · Apr 1, 2021

Archer
Well, if you are concerned with unequal comparison, this is one here. Unless you are claiming that crypto is equal in economic activity to the whole US banking system, which seems unlikely.

If there is a comparison of how much energy is consumed by the equivalent amount of economic activity from each, that would be good to see.

Yes it’s easy to look up I’m working now just talking a break to fill my stomach but if the argument is, and I will make people pleased I have no issue stating very clearly that a downside of btc is it’s energy inefficiency. In the early days you could mine it on your phone, over time the computations become greater requiring even more power. Do people feel it should be eradicated due to its electrical use. We lose about 8% of electricity as it makes its way down its transmission route. How much does that equal overtime. Bitcoin is not efficient, I could capitalize that.

Archer · Apr 1, 2021

Walrus
We lose about 8% of electricity as it makes its way down its transmission route. How much does that equal overtime. Bitcoin is not efficient, I could capitalize that.

Reminds me of when I would tell my mother I wanted to do something because others were doing it. Her reply was always "If everyone jumps off a bridge would you do it too?"

Walrus · Apr 1, 2021

Archer
Reminds me of when I would tell my mother I wanted to do something because others were doing it. Her reply was always "If everyone jumps off a bridge would you do it too?"

I look at it differently. Without getting into too much detail I work with a tremendous amount of disadvantaged humans, well right now my caseload is 23, I’ve had up to 80 at different jobs. A couple of these people were able to put 500 into bitcoin when it was sitting at 1-3 thousand. Each 500 they put in is now worth 5k. To them that is life changing. The barriers to obtain bitcoin were less intimidating than stocks. If it provides such opportunities to people, I’ll take a bunch of news articles about energy use in a world full of disposable humanity. Seems like people are more concerned about bitcoin energy use than the rising rate of suicide and drug abuse, selective outrage for reasons beyond my comprehension

Walrus · Apr 1, 2021

This is a decent article talking about how bitcoins energy usage has become a political issue. Are people aware how it has helped Venezuela, Nigeria and yes westerns as well. I think to look at it concretely is missing a large part of the discussion. If people feel bitcoin is inherently bad because of its energy use I’m not here to change anyone’s mind. I just think to properly discuss the issue it must be greater than “more power than Switzerland” it has done much to help people in need. I can’t think of anything that doesn’t have negative aspects in one form or another. Does the good outweigh the bad? I believe so but perhaps others feel different

https://www.google.com/amp/s/www.fo...n-is-a-highly-charged-debate--whos-right/amp/

eugeneandresson · Apr 1, 2021

Walrus
And when we hear “more power than Switzerland” what does that mean.

I assume it is purely measurable electricity consumption (ie measurable by usage in the countries power grid, VS estimated on Bitcoin side by known hash rate of the network and power consumption based on units of that hash rate). So, all homes, industries, trains (this place is well and fully connected by trains that run 24/7, trains are also used for goods), trams etc...things that suck electrons from the power grid (which includes the entire Swiss banking industry 😉 ).

Walrus
Does that include gas, natural gas, solar, windmills, eighteen wheelers?

If it did, it would only make it worse for Bitcoin!

Walrus
the hope that as it became widely adopted people would smarten up and find efficient means of mining it.

One thing is to use ‘cheap energy’. But that’s not the problem. The problem is that most of the energy used is essentially for nothing. So even if it was all solar powered, it would still be a massive inefficient redundancy of wasted computing power. The only way they can address this problem is to redesign the Bitcoin software to work differently. Good luck with that ...

Walrus · Apr 1, 2021

eugeneandresson
I assume it is purely measurable electricity consumption (ie measurable by usage in the countries power grid, and estimable by known hash rate of the network and power consumption based on units of that hash rate). So, all homes, industries, trains (this place is well and fully connected by trains that run 24/7, trains are also used for goods), trams etc...things that suck electrons from the power grid (which includes entire banks 😉 ).

If it did, it would only make it worse for Bitcoin!

One thing is to use ‘cheap energy’. But that’s not the problem. The problem is that most of the energy used is essentially for nothing. So even if it was all solar powered, it would still be a massive inefficient redundancy of wasted computing power. The only way they can address this problem is to redesign the Bitcoin software to work differently. Good luck with that ...

For nothing? A trillion dollars added to the economy that enabled a bunch of normies to increase there wealth, make transactions in countries where people had no access to banks. Granted I realize bitcoin like all things of value have become dominated now by institutions and whales but I really don’t see it’s use of power as being for nothing. Remember many articles include more than just Switzerland and they make no distinction other than “more than these three countries use.” See though I don’t want to get all hung up on the power thing. It’s intention was to help mankind and do some good. I do believe in many way that has happened. Do you know how happy I was one of my clients finally told me he had 5k in bitcoin saved when I was busting my balls trying to find him housing. I got people on waiting lists to get on waiting lists for housing. Look how bitcoin helped Venezuela when dumpsters were full of their worthless dollar. It goes a little beyond power usage and again I’m not dismissing your concerns, I think we are stewards of the planet and should respect and care for it. Can I ask you, do you think bitcoin is inherently bad due to its power consumption? I mean if that’s how you feel that’s how you feel. You don’t even have to limit it’s power use to equal Switzerland you can find articles that will give you three sometimes four countries. Shoot I’ve read articles that it’s directly responsible for global warming. There are a lot of countries that don’t like bitcoin. I wonder if they have any motivation to push and highlight the negative side of it. Is there anything man has created that doesn’t have some negative things we can point out and do we fairly do that with all things? Should bitcoin be banned because of its inefficiencies?

Walrus · Apr 1, 2021

https://nakamotoinstitute.org/mempool/bitcoin-does-not-waste-energy/

Walrus · Apr 1, 2021

In 2010 this is what satoshi said about bitcoins power consumption

https://www.google.com/amp/s/decryp...-bitcoins-energy-consumption-resurfaces?amp=1

Archer · Apr 1, 2021

Walrus
I look at it differently. Without getting into too much detail I work with a tremendous amount of disadvantaged humans, well right now my caseload is 23, I’ve had up to 80 at different jobs. A couple of these people were able to put 500 into bitcoin when it was sitting at 1-3 thousand. Each 500 they put in is now worth 5k. To them that is life changing. The barriers to obtain bitcoin were less intimidating than stocks. If it provides such opportunities to people, I’ll take a bunch of news articles about energy use in a world full of disposable humanity. Seems like people are more concerned about bitcoin energy use than the rising rate of suicide and drug abuse, selective outrage for reasons beyond my comprehension

No doubt people have made money with it. It’s useful in a lot of ways, not all good.

Cheers, Al

Walrus · Apr 1, 2021

Archer
No doubt people have made money with it. It’s useful in a lot of ways, not all good.

Cheers, Al

Well yes and I have no issue pointing out it’s negatives. I do think the pros outweigh the cons but I am not the final authority on anything

eugeneandresson · Apr 2, 2021

Walrus
For nothing?

Correct.

Let me give you a simpler analogy:

You want to warm up a sausage to eat. You only need to burn 1 piece of wood to warm up your sausage. You burn down an entire forest, to warm up that one sausage. Sure, your sausage got warmed up, but all that energy was used for nothing (aka wasted -> my point).

Thats how Bitcoin works. Lets further the analogy from one of your own articles :

You want to warm up a sausage to eat. There are 1000000 people who light a fire, for you. You only use the first fire that reaches the optimal temperature (and they are the only ones who you pay for burning wood). A huge waste.

Sure, gold is also a waste. The biggest difference is (and why I don't agree with using it to justify the energy waste of Bitcoin) there is no other option with gold, and there is no exponential increase of gold miners all adding to the waste (like in the early days of the gold rush). Edit: there is also no competition, making gold mining ‘faster’ and wasting more power. Gold mines who have rights to the ground containing gold are the only people doing mining on that ground, at their rate and fixed costs etc.

I also don't agree that this is the only way to enforce integrity of a system (the author claims this is why the means are justified - they are not). With Crypto in general, there are infinite other options to do it better/more-efficiently that only require good imagination/ideas/engineers/software...and thats what is currently happening in other spaces.