General Crypto Currency world

tajhay

Negative Nancy
Mar 30, 2012
10,457
Sydney
What I find interesting is the few people I've spoken to about the crypto currencies are also adamant that landlords in NZ should be subject to a capital gains tax when they sell their properties. Reasons included that the owning a rental property doesn't help with growth in NZ. They didn't like it when I pointed out neither did their "investments" and certainly didn't like it when I asked if they paid income tax on the gains their investments had made when they sold them or would they declare that income when they eventually did sell them.
Crypto in NZ is not subject to CGT?
 

Miket12

Warriors 1st Grader
Apr 20, 2012
10,394
Crypto in NZ is not subject to CGT?
It comes down to the ”intention” when something is purchased. The IRD is supposed to tax capital gains but doesn’t have the resources (and the desire) to do so.

Say, when a rental property is purchased. If the intention is not to buy it because of a capital gain which may occur when it’s sold but to either produce a profit for the landlord when sold because the mortgage has been paid back or to produce an income from the rent, then the capital gain is not subject to tax.

It’s far more difficult with something like crypto when the only way to make money is to sell the currency for a profit. I can’t think of any other “intention” someone could give the IRD. Of course, it then comes down to the “honesty” of the investor and if they are going to declare the income they’ve made from the capital gain to the IRD.
 

Miket12

Warriors 1st Grader
Apr 20, 2012
10,394
Also, people who use online platforms like Sharesies should be declaring and paying tax on the capital gains their shares may make. Of course, like most, if not all, crypto investors in NZ, they don’t.
 

Tony Martin

1st Grade Fringe
Jun 4, 2016
942
Bought about $8k worth of WTC in 2017. Wallet was about 50k at one point. Then became greedy and didn’t take out the 8k I originally invested. Walked away with about 1k I think. A little hesitant to jump back in
 

Mr Dragon

1st Grade Fringe
Jul 25, 2015
1,426
Some people buy gold/silver for investment too. Supply/Demand is always a key factor in determining value of anything. BTW yes you can use crypto to pay for basically everything you want, from household bills, to travel to larger items like cars/houses.

But you are right in the sense that crypto is not mainstream yet, a large proportion of investors are buying to speculate rather than use. There are others who are using alt coins to go up in value to convert back to btc/eth/etc to increase their holdings in those.

Volatility is another thing holding it back.

I consider crypto to be in an infancy stage. Its not for everyone. If you are happy with FIAT go for it. But at the end of the day im sure you have heard the saying that its 'not worth the paper its printed on'. Im sure when printed notes were introduced, they would have been going through the same queries as we are today. "So you mean this piece of printed paper is worth than my lump of gold/silver? GTFO". The difference here is that paper can be printed on, to an endless amount. Is your $10 printed note really worth the same $10 value after the reserve bank has printed millions more since you received it?

Anyway interesting question. The world is becoming more digital infront of our eyes. It will only become more digital than physical in the future. Blockchain tech will further facilitate stronger ownership/transactional record keeping with the ledger. There will be a time when the world moves away from printed paper. Whether that happens in our time or if crypto is the successor is the question. Im personally not too sure about that. But IMO blockchain tech will be part of our everyday lives in the future.
You are right my brother, the day people like me use it, it will be mainstream, i was probably the last person to start banking online and now do it all the time without fear of my money disappearing. 🤣
 
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Juju

1st Grade Fringe
Nov 9, 2012
1,856
What I find interesting is the few people I've spoken to about the crypto currencies are also adamant that landlords in NZ should be subject to a capital gains tax when they sell their properties. Reasons included that the owning a rental property is unproductive and doesn't help with growth in NZ. They didn't like it when I pointed out neither did their "investments" and certainly didn't like it when I asked if they paid income tax on the gains their investments had made when they sold them or would they declare that income when they eventually did sell them.
Young families can't actually live in cryptocurrency - which is why most people want investment properties taxed - rather then the gross rampant tax free profits.
 
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wizards rage

1st Grade Fringe
Apr 18, 2016
4,544
Tauranga
It comes down to the ”intention” when something is purchased. The IRD is supposed to tax capital gains but doesn’t have the resources (and the desire) to do so.
The government doesn’t won’t ever know about any capital gains with crypto because it’s untraceable.

It relies on honest... good luck 🤣
 

Swanley

Warriors 1st Grader
Apr 13, 2012
3,040
Tonbridge, Kent, UK
Some people buy gold/silver for investment too. Supply/Demand is always a key factor in determining value of anything. BTW yes you can use crypto to pay for basically everything you want, from household bills, to travel to larger items like cars/houses.

But you are right in the sense that crypto is not mainstream yet, a large proportion of investors are buying to speculate rather than use. There are others who are using alt coins to go up in value to convert back to btc/eth/etc to increase their holdings in those.

Volatility is another thing holding it back.

I consider crypto to be in an infancy stage. Its not for everyone. If you are happy with FIAT go for it. But at the end of the day im sure you have heard the saying that its 'not worth the paper its printed on'. Im sure when printed notes were introduced, they would have been going through the same queries as we are today. "So you mean this piece of printed paper is worth than my lump of gold/silver? GTFO". The difference here is that paper can be printed on, to an endless amount. Is your $10 printed note really worth the same $10 value after the reserve bank has printed millions more since you received it?

Anyway interesting question. The world is becoming more digital infront of our eyes. It will only become more digital than physical in the future. Blockchain tech will further facilitate stronger ownership/transactional record keeping with the ledger. There will be a time when the world moves away from printed paper. Whether that happens in our time or if crypto is the successor is the question. Im personally not too sure about that. But IMO blockchain tech will be part of our everyday lives in the future.
I'm a gold and silver man, like the physicality of it.

I think with Crypto, it is starting to go mainstream which will add a bit of stability and security around holding it.

As an example, the company I work for is looking at holding it on behalf of clients, and is really working hard into getting blockchain functionality up and running.

But again, I think it is still seen as high risk, at work, we need to get permission to even buy some. and then some people are prohibited from holding it.
 
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Miket12

Warriors 1st Grader
Apr 20, 2012
10,394
Young families can't actually live in cryptocurrency - which is why most people want investment properties taxed - rather then the gross rampant tax free profits.
Cryptos are making gross rampant tax free profits. Again, capital gains on investment properties are subject already to capital gains, if it was purchased with the intention of selling it for a capital gain.

Just in the same way that businesses, shares, artwork are also subject to capital gains.... just like the profit people make buying and selling crypto.

 
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Juju

1st Grade Fringe
Nov 9, 2012
1,856
Cryptos are making gross rampant tax free profits. Again, capital gains on investment properties are subject already to capital gains, if it was purchased with the intention of selling it for a capital gain.

Just in the same way that businesses, shares, artwork are also subject to capital gains.... just like the profit people make buying and selling crypto.

I'm not sure anyone actually begrudges people .. But it's the way property investors / landlord carry on about the status quo changing that rubs most people (outside of the market) the wrong way.

The Government 100% should be pulling the levers as much as they can to make investment properties less attractive (amongst other things).
Owning a family home should be attainable goal in NZ, owning mega property portfolios as investments shouldn't.

Crypto / Art / Shares should be fair game - just don't come whinging for a bail out when it turns to shite.
 
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Miket12

Warriors 1st Grader
Apr 20, 2012
10,394
I'm not sure anyone actually begrudges people .. But it's the way property investors / landlord carry on about the status quo changing that rubs most people (outside of the market) the wrong way.

The Government 100% should be pulling the levers as much as they can to make investment properties less attractive (amongst other things).
Owning a family home should be attainable goal in NZ, owning mega property portfolios as investments shouldn't.

Crypto / Art / Shares should be fair game - just don't come whinging for a bail out when it turns to shite.
We purchased our rental property in 2016. According to homes.co.nz, it‘s gained $180 k since we brought it. If we had instead used the 20% deposit to buy into Bitcoin at the same time, we would have made over $10 mil. in untaxed capital gain if we choose not to declare it. Even paying tax on it would net us $6 mil.

BTW, the Brightline test doesn’t apply to us because of the time we’ve owned the property so it we were to sell it, since It wasn’t our intention to make a capital gain on (as we intend to downsize to it), we wouldn’t need to pay tax on it.
 

Juju

1st Grade Fringe
Nov 9, 2012
1,856
We purchased our rental property in 2016. According to homes.co.nz, it‘s gained $180 k since we brought it. If we had instead used the 20% deposit to buy into Bitcoin at the same time, we would have made over $10 mil. in untaxed capital gain if we choose not to declare it. Even paying tax on it would net us $6 mil.

BTW, the Brightline test doesn’t apply to us because of the time we’ve owned the property so it we were to sell it, since It wasn’t our intention to make a capital gain on (as we intend to downsize to it), we wouldn’t need to pay tax on it.
Yes but young families can't live in Bitcoin... the Government should be going hard in a targeting way to alleviate this particular issue.
The bleating from landlords / investors when this is even raised is truly icky.

Trust me, if you were a generation younger you would be all for this.
 
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Miket12

Warriors 1st Grader
Apr 20, 2012
10,394
Yes but young families can't live in Bitcoin... the Government should be going hard in a targeting way to alleviate this particular issue.
The bleating from landlords / investors when this is even raised is truly icky.

Trust me, if you were a generation younger you would be all for this.
My brother brought nine Bitcoins five years ago with the intention of selling three each time his children turned 21 and giving them the money so they could pay off their student loans. The first is turning 21 in a few months time and she will instead have a deposit for either an apartment or a small house.

BTW, there is a second side to housing affordability most people forget about and that’s your income which not only affects your deposit but also you ability to service a mortgage. I wonder how easy that will be if you work for the government and watch inflation erode your ability to save over the next three years or, as some are predicting, paying higher interest on your mortgage.

Yes, you can go up a band in the public service but that band will be kept at the current level and not inflation adjusted.
 

Miket12

Warriors 1st Grader
Apr 20, 2012
10,394

Dogecoin gives away the crypto game​

It has often been hard to make sense of financial markets in 2021. First there was the 1,500 per cent rally in flailing video game retailer GameStop, then there was the $100m valuation of a New Jersey deli, and then there was a 15,000 per cent surge in dogecoin, a cryptocurrency designed as a joke.

"Do you want Tesla to accept Doge?" the electric car company's chief executive and self-styled "technoking" Elon Musk asked his Twitter followers on Tuesday. The tweet was just the latest of several Musk shout-outs to the digital coin, which is based on a meme showing the face of a Shiba Inu dog overlaid with an imaginary inner monologue: "Wow"; "so scare"; "keep ur hands away from me".

Dogecoin functions the same way as bitcoin — it's a digital token underpinned by a decentralised network of computers that process and keep track of transactions via a digital ledger called a blockchain. But unlike the original cryptocurrency, whose backers use highbrow arguments to justify and shore up its value, dogecoin has been a joke from the outset.

Yet while few people are claiming that dogecoin will "democratise finance", or become "the global reserve currency", or fundamentally change the world, since its creation in December 2013 it has hugely outperformed bitcoin. While the latter has climbed a remarkable 7,700 per cent during that period, dogecoin has rocketed by an almost unfathomable 200,000 per cent.

In other words, if you wanted to make some money on crypto over the past seven-and-a-half years and chose to buy bitcoin rather than dogecoin, the joke's sort of on you.

Dogecoin gives the lie to the idea that we should take bitcoin and other cryptocurrencies terribly seriously. While crypto evangelists might want everyone to buy into the notion that bitcoin is going to take over from the dollar one day, and that we all need to hold some of it in order to protect ourselves from the evil central bankers who want to inflate away the value of our money, the reality is that their arguments are largely just a self-interested attempt to boost the price of cryptocurrencies.

Much like a pyramid scheme, those who got in early on bitcoin have a huge financial incentive to draw in others by any means necessary. But while getting rich is clearly the main motivating factor — and some people have indeed managed to become incredibly rich from crypto — it is not the only one.

Buying into crypto should be considered akin to gambling and, like gambling, people get into it not just because they might make money, but also because it's entertaining. It's no coincidence that cryptocurrencies and "meme-stocks" have surged in a year in which much of the world has been locked up indoors. It is the result of what Bloomberg columnist Matt Levine has called the "boredom markets hypothesis".

Crypto trading is often more accessible than gambling, particularly in places where betting is heavily regulated, such as in the US. It allows buyers to feel like they're in some kind of tribe. And while the "LOL" factor might not be considered a traditional metric for working out the value of an asset, that doesn't mean it shouldn't be: clearly, the extent to which it is fun to buy into something has an impact on how much it is bought, and nowhere can that be seen more clearly than in dogecoin.

The joke-coin makes a mockery of the idea that crypto investing should be considered a serious pursuit. Its very existence undermines the notion that bitcoin derives value from its scarcity. While bitcoin's total supply will eventually be capped at 21m, as written into its original source code, there is no limit to the number of copycat cryptocurrencies that compete with it — there are now almost 10,000, and dogecoin itself has no hard supply cap.

Dogecoin's success makes just as much sense as the rest of the crypto market — people buy into these coins because doing so is exciting, it gives them something to do and discuss with their friends, and of course because it can allow them to make a quick buck. But perhaps it can also allow us to stop taking the crypto project quite so seriously. While we're at it, we might do the same with the stock market.

- Financial Times

 

Evil_Mush

1st Grade Fringe
May 18, 2012
169
Always keen to find out reliable platforms for investing.

Only recently been even in a position to put any money towards crypto/shares but got burnt last year on CMC Markets (everything was looking good then bang one bad day and all my positions were closed, good on me not knowing what the hell I was doing hah), so staying away from that aside from what little I have left in there that I didn't cash out.

Now have used Easy Crypto to buy and Exodus Wallet to store, but still low value investor (got about $2k all up between Bitcoin Ethereum mainly and a couple of random ones I stuck couple hundy each on a whim).

Been listening to a bunch of podcasts, Max Keiser who is a wee bit crazy but got in on the Bitcoin train early (2011) and has a bunch of Wall Street experience from back in the day reckons Bitcoin is just gonna keep going up whereas all other cryptocurrency is basically casino gambling trash at the moment (as the article posted above basically says for all crypto).
Might just follow that advice in the meantime while I still barely understand it all hah!
 
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