The Bitcoin (BTC) thread

Deepdiver

Crow
Gold Member
I guess our definition of "crazy risks" is a bit different. I'd bet most agree that raising your hand to the IRS saying "yes, I own crypto!" is a crazy risk. Becuase that's exactly what happens when you go through KYC.
LOL now that BTC is pushing $20K the old BTC meetup solution to sell BTC for cash at a meetup can get you jacked BLMA style. I have not yet seen a non-KYC exchange or DEFI platform that allows for exchange of BTC for Dollars, Euros, Rubles, Yuan etc.

Blockfi allows you to allocate some BTC to earn % like a CD and to have a credit card to spend for local fiat purchases and to borrow against BTC for various biz or personal needs without having to sell your BTC thus not incurring Cap Gains taxes about to Double under Kommie Kamala Beijing Biden.

You either manage your taxes and IRS rules and regs or the IRS manages you.
 

redbeard

Hummingbird
Gold Member
There are other solutions out there - HodlHodl, Bisq.

It isn't even about taxes, it's about operational security. I don't want President Harris knocking at my door.
 

JayJuanGee

Crow
Gold Member
LOL now that BTC is pushing $20K the old BTC meetup solution to sell BTC for cash at a meetup can get you jacked BLMA style. I have not yet seen a non-KYC exchange or DEFI platform that allows for exchange of BTC for Dollars, Euros, Rubles, Yuan etc.

Blockfi allows you to allocate some BTC to earn % like a CD and to have a credit card to spend for local fiat purchases and to borrow against BTC for various biz or personal needs without having to sell your BTC thus not incurring Cap Gains taxes about to Double under Kommie Kamala Beijing Biden.

You either manage your taxes and IRS rules and regs or the IRS manages you.

Yes, Deepdiver. Over the years, you have demonstrated a penchant to pump non-bitcoin options in this thread at any opportunity that you seem to get.. you believe that you have a BIGGER audience in this thread.

This is another one of those situations.
 

Deepdiver

Crow
Gold Member
Yes, Deepdiver. Over the years, you have demonstrated a penchant to pump non-bitcoin options in this thread at any opportunity that you seem to get.. you believe that you have a BIGGER audience in this thread.

This is another one of those situations.
Talk about a disrespectful comment ... Blockfi is all about innovative ways to profit on BTC HODLs without incurring unnecessary short term Cap Gains taxes - so - I guess you are in with the lot that does not want to pay any taxes - or - you are outside the USA or the IRS has not caught up with you yet.
 
Last edited:

Deepdiver

Crow
Gold Member
There are other solutions out there - HodlHodl, Bisq.

It isn't even about taxes, it's about operational security. I don't want President Harris knocking at my door.
RB I hear you about OpSec - thanks for the link - problem is I have to pay my bills in USD and have not found a way to convert my Cryptos to USD on a no KYC platform.

Interesting Pomp Interview discussing merits of BTC and Gold - Dan mentioned that when Gold hits $4,000 BTC likely to hit $400K USD another reason why borrowing against BTC is a fast growing market for long term HODLers.

(225) Pomp Podcast #436: Dan Tapiero on Gold and Bitcoin - YouTube

 

Blade Runner

Pelican
Orthodox
Long term, sure...

Just listening to an interview on the Kaiser report with some institutional money guy though, and he said something interesting...

"I'm a fiduciary. [Clients trust me with their money]. So if I'm going to invest in something, I have to understand it. I don't understand bitcoin... I don't understand how it can have a value of close to $20K..."

Just think how many institutional guys think that way. And it's not their money. Plus they have senior guys above them who understand it even less, carry the buck, and who would have to approve the investment.

A few big names coming out in support isn't going to change that too quickly.

It's one thing to risk your own money on something you understand, it's totally another to risk someone else's money on something you don't, AND put your nuts on the line to persuade your old money boss it's a good idea.
Just wait for the Fed spigots to open even more, and people will be looking for scarce entities, regardless of if they understand it or not. It's funny because you aren't seeing the future, nor are they, clearly at all. But I don't expect old guys too. Times have been good for their whole lives, more or less. And they don't believe anything as bad as what's coming is coming. Fact.
 

JayJuanGee

Crow
Gold Member
Talk about a disrespectful comment ... Blockfi is all about innovative ways to profit on BTC HODLs without incurring unnecessary short term Cap Gains taxes - so - I guess you are in with the lot that does not want to pay any taxes - or - you are outside the USA or the IRS has not caught up with you yet.

You take things pretty personally..for some strange reason.

No, I am not opposed to guys attempting to figure out various ways that they might not have to sell their BTC in order to be able to get cash flow from those kinds of mechanism.

I suppose that I was triggered by your use of the term Defi, rather than blockfi.. even though I still am a bit unclear if blockfi would be the right vehicle for such a thing..
 

Arado

Pelican
Gold Member
Just wait for the Fed spigots to open even more, and people will be looking for scarce entities, regardless of if they understand it or not. It's funny because you aren't seeing the future, nor are they, clearly at all. But I don't expect old guys too. Times have been good for their whole lives, more or less. And they don't believe anything as bad as what's coming is coming. Fact.
A small percentage of financial advisors were in the markets during 70s stagflation. None of them know how to play it, which is why they keep recommending 60/40 stocks bond allocation, which makes zero sense with stocks at all time highs and bonds at negative real yields. Hard assets will be the name of the game. Bitcoin is perfectly timed for this moment - any earlier and it would be too unproven.

Here is an interesting video. Not sure if there is exaggeration here, but seems like with all the BTC lost and gobbled up by billionaires and large institutions, there's less than 7 million bitcoins out there for normal people (out of global population of 7+ billion). So, with 1 bitcoin you are now in the top .1% of BTC owners worldwide, and almost definitely in top 1% of Americans.

 

JayJuanGee

Crow
Gold Member
A small percentage of financial advisors were in the markets during 70s stagflation. None of them know how to play it, which is why they keep recommending 60/40 stocks bond allocation, which makes zero sense with stocks at all time highs and bonds at negative real yields. Hard assets will be the name of the game. Bitcoin is perfectly timed for this moment - any earlier and it would be too unproven.

Here is an interesting video. Not sure if there is exaggeration here, but seems like with all the BTC lost and gobbled up by billionaires and large institutions, there's less than 7 million bitcoins out there for normal people (out of global population of 7+ billion). So, with 1 bitcoin you are now in the top .1% of BTC owners worldwide, and almost definitely in top 1% of Americans.


That Monkey Rules guy is really excited about what seems to be going on with Bitcoin's current supply, and even if his numbers are NOT exactly right, he is still capturing the kind of sentiment and dynamic that is out there in the bitcoin speculation space in respect to bitcoin's supply - and the hardness of what seems to be a lessening of available bitcoin.
 

redbeard

Hummingbird
Gold Member
I received a PM from a member asking my thoughts on using a hardware wallet vs. Samourai. I figured I’d post the answers here to benefit everyone reading.

Do I really need a hardware wallet?

Some will disagree, but I don’t think it’s as necessary as hold dogma. Compared to running a wallet on your computer, hardware wallets (HWW) protect against two vectors:

Malware infecting your computer and stripping your private keys.
Your computer breaking or getting stolen, and you losing your keys with it.

That’s about it. While protecting against these two threats is important, it’s not everything.

With a HWW, you still have to worry about $5 wrench attacks:

security.png


Plus, you have to trust that the wallet manufacturer will keep their software up to date. Many are not open source. If the wallet producer goes belly-up, you better hope you can import that wallet into another one, and that you know how to do that.

So, HWW are not perfect solutions and don’t necessarily mean your coins are bulletproof.

Then, why are HWW pushed so hard by crypto influencers?

Besides shilling affiliate links to questionably legal Chinese exchanges, there really aren’t many ways to make money in the crypto niche. You can sell a trading course for four figures, but that doesn’t appeal to the Average Joe. HWW are a great way to profit off the fear of losing your precious cryptos.

What do you recommend instead?

Use a dedicated wallet phone. Specifically, a de-googled Android with Samourai Wallet. The easiest way to get started is to buy a Google Pixel 3a on Craigslist ($150-$200) and install GrapheneOS.

Is this as secure as a HWW?

Rewinding to what HWWs do, using a separate phone as a wallet protects against the same vectors. It’s a separate device (so no risk of physical loss) and you likely won’t get malware since you’re only using this phone for one purpose. When not in use, just turn it off and rest assured your coins are safe.

The only caveat is that yes, your phone will go online when you use the wallet to transact (which only takes a few minutes). But realistically, it’s not like turning on the wallet means hackers are going to rush in and steal your keys. Samourai also operates over Tor so your connections are kept private. Plus, Graphene is seriously secure and won’t download any software unless you tell it to.

What if I lose the phone?

Samourai gives you a passphrase protected recovery seed just like every other HWW. Simply fire up the app on another phone and you can re-import your wallet within minutes. The app is also PIN-protected.

Why Samourai Wallet?

Samourai is a privacy-focused wallet that has a ton of power-user features that other wallets do not offer. The most important of these being - Whirlpool.

Whirlpool is a mixing client that takes your coins, mixes them with others, and spits out equal outputs. This breaks all links with your previous transactions. Here is a visual representation of a Whirlpool mix:

68747470733a2f2f73616d6f7572616977616c6c65742e636f6d2f7374617469632f7075626c69632f696d616765732f776869726c706f6f6c2f6b7963702d6578616d706c652e706e67


5 unequal inputs go in. 2 unequal (new mixes) and 3 equal (remixes). 5 equal outputs come out. By utilizing Whirlpool you eliminate all backward looking connections to your coins.

Why is that important?

Let's do an example. Pretend you buy BTC on Coinbase. They know exactly who you are (thanks to KYC), exactly how many coins you bought, and where you sent them to.

Let's say you sent 0.5 BTC from Coinbase to your HWW. Then, you send 0.1 BTC to your favorite wrongthink content creator, Roosh V.

At that point, Coinbase can guess with high certainty that it was you who sent a donation to Roosh. It doesn't matter that there's two hops between Coinbase and Roosh. It's very, very likely that the donation to Roosh came from you. Plus, that transaction is permanently filed on a public ledger, forever.

Now, instead pretend you send from Coinbase to Samourai. After sending your coins through Whirlpool, Coinbase has no idea where those coins went. After one mix, your coins could be one of five. Now imagine everyone in your mix remixes. That means that your coins could be any one of 25 (5^2) outputs!

So, using Whirlpool guarantees that whoever you bought your coins from won’t know where they went after your purchase.

To learn more, read this: https://github.com/Samourai-Wallet/Whirlpool

Why not Wasabi wallet?

Wasabi sucks. Its lead maintainer has said it should not be used on dark net markets. Do you really trust a wallet whose creator doesn’t trust his own product?

OK, I’m ready, what do I do now?

For starters, you can run it right on your phone if you use Android since it’s available on the Google Play store. But. Then Google has a record that you downloaded it. Not good!

The best technique is to download the .apk file directly on a de-Googled phone. The easiest way to do this is to buy a used Google Pixel 3a ($150-$200) and put GrapheneOS on it: https://grapheneos.org/

If you’re worried about the difficulty of porting a custom Android ROM like Graphene, don’t worry there’s tons of videos on YouTube walking you through step-by-step.

OK you’ve sold me on Samourai. But why can't I mix on Samourai, then send to a HWW?

You can. However, you might give up your security by paying a fee. All Samourai outputs look the same, in 0.01, 0.05, and 0.5 BTC denominations. By sending a UTXO out of Samourai, you pay a fee, which turns that 0.5 BTC ingot into an 0.499925 BTC coin. That makes it identifiable, especially if you send a bunch of transactions at the same time.

This article goes on to explain problems with sending to a HWW as well as how to turn a Samourai wallet into “cold storage,” and how to send to a HWW if you really have to:
Additionally, Samourai gives you free remixes. If you use the RoninDojo or Whirlpool GUI, you can remix your UTXO's for free for eternity. This means your coins will gain even more anonymity, as the number of possible mix outputs increases.

Does that mean I can buy BTC on Coinbase, send it to Samourai, and my coins will be completely private?

Absolutely not.

No matter what you do with your BTC, Coinbase still keeps a record of every time you buy BTC. It doesn’t matter if you mix your coins. They still have that record, and they still know that YOU bought BTC. They can’t track what you do with said coins, but you’re still on record as being a BTC buyer.
 

Deepdiver

Crow
Gold Member
You take things pretty personally..for some strange reason.

No, I am not opposed to guys attempting to figure out various ways that they might not have to sell their BTC in order to be able to get cash flow from those kinds of mechanism.

I suppose that I was triggered by your use of the term Defi, rather than blockfi.. even though I still am a bit unclear if blockfi would be the right vehicle for such a thing..
Would appreciate your informed analysis subsequent to viewing the Blockfi interview by Ral Paul.
 

redbeard

Hummingbird
Gold Member
@redbeard what are the most realistic issues you are worried about in terms of security? Corporate, government, criminals?
Honestly, in order of possibility:

#1 - Government

Legislative attacks are riskier than people estimate. Right now BTC is not that much of a threat to government money. Once they realize what's actually going on, they will come after it hard. It doesn't take much for them to ban running a node, or require you to get a state license to sell BTC (check out BitLicense in NY).

This is why BTC needs to become more antifragile. More nodes, less custodial services, more FOSS solutions that are censorship resistant.

Take a look at what happened with the 6102 order for gold. It's not inconceivable that they would outright ban ownership of BTC. In that case, I hope you didn't buy on Coinbase, because they'll be knocking on your door first.

Read this:

#2 - $5 Wrench

As BTC becomes more popular I think petty criminals will start to recognize the tools. Hardware wallets, 2FA, etc. If someone breaks into your house and sees a Ledger, that's easy money if they know what they're doing and can get you to cough up the PIN. It's probably best for us to focus on protecting our homes, especially as civil unrest continues.

#3 - Cybercriminals, phishing, etc.

It doesn't seem that much of an issue (yet) for the average Bitcoiner. Most attacks are carried against exchanges, and not individuals, but it's important to be defensive online.
 

Coja Petrus Uscan

Hummingbird
Gold Member
I suspect any government action will take at least a few more years. Governments are very slow at acting domestically, e.g. it takes about ten years before a legal high is first mentioned in the houses and government and it gets banned, regulations and so on.

So I think we should have a few warning bells before a possible BTC crackdown, which is only going to serve to a large price suppressant. I think it would actually hasten adoption.

I don't buy that Bitcoin is some kind of scam. If it were I'd expect there to be scholarly globalist white papers about the benefits one one - not seen any. The papers are about central bank digital currencies (CBDCs).

The only way I could see it being used as a scam is if it is hijacked as a sort-of freemium model. People see it as a chink of light in the seeming coming dystopia. Then there is a bait and switch, where you are forced to hand over your BTC for CBDCs.

Switzerland and Lichtenstein will likely be safe spots to such moves.
 

Caractacus Potts

Woodpecker
Gold Member
I think I know the answer to this question but I am curious to hear opinions from more established crypto investors...

What are your thoughts on purchasing Grayscale Bitcoin Trust (GBTC) in an IRA? My two major concerns are 1) I don't personally hold my BTC in a wallet and 2) what if these are like the GLD or SLV ETFs, i.e., they don't hold actual BTC just a promise to buy it.

I have been purchasing BTC for a few months and will continue to do so (DCA) but I have some money in my IRA that I would like to put to work.
 

redbeard

Hummingbird
Gold Member
I think I know the answer to this question but I am curious to hear opinions from more established crypto investors...

What are your thoughts on purchasing Grayscale Bitcoin Trust (GBTC) in an IRA? My two major concerns are 1) I don't personally hold my BTC in a wallet and 2) what if these are like the GLD or SLV ETFs, i.e., they don't hold actual BTC just a promise to buy it.

I have been purchasing BTC for a few months and will continue to do so (DCA) but I have some money in my IRA that I would like to put to work.
I don't think it's the end of the world if you do buy it. It's similar to GLD or SLV.

However. Just like with metal ETFs, you lose the ability to use Bitcoin in a SHTF scenario. That in and of itself is enough reason for me to want to hold physical BTC instead of paper.
 

Coja Petrus Uscan

Hummingbird
Gold Member
One upside of Greyscale is their ETNs are prone to bigger swings.

I bought their ETH ETN in March. 1 share is equal to close to 0.1 ETH. I bought it at about $60 and within 2 months it had FOMO'd up to $250. I cashed out at about $190. I.e. the price on Greyscale was $2,500 when the market price was $260.

If there is all round crypto FOMO I think you can guarantee their notes will give considerably higher gains as dinosaurs are pulled in during the mania phase.

The notes are not available on many platforms though. You can get them on SwissQuote and Interactive Brokers.

Also worth noting is the books are thin and its an OTC market with no data. So when you sell you want to use limit and not market sell. I used a market sell and sploshed the price down about $30 in one go, about 15%.

Another benefit is that if there are government moves against crypto it gives you a very quick rip cord back to cash on a legacy platform.
 

redbeard

Hummingbird
Gold Member
One upside of Greyscale is their ETNs are prone to bigger swings.

I bought their ETH ETN in March. 1 share is equal to close to 0.1 ETH. I bought it at about $60 and within 2 months it had FOMO'd up to $250. I cashed out at about $190. I.e. the price on Greyscale was $2,500 when the market price was $260.

If there is all round crypto FOMO I think you can guarantee their notes will give considerably higher gains as dinosaurs are pulled in during the mania phase.

The notes are not available on many platforms though. You can get them on SwissQuote and Interactive Brokers.

Also worth noting is the books are thin and its an OTC market with no data. So when you sell you want to use limit and not market sell. I used a market sell and sploshed the price down about $30 in one go, about 15%.

Another benefit is that if there are government moves against crypto it gives you a very quick rip cord back to cash on a legacy platform.
Yes, there's a whole arbitrage game to be played with the spreads on GBTC. Tone Vays does this a decent amount. From what I understand, you manually calculate what one GBTC should be worth and bet towards what it's actually trading at. But, that's getting more into gambling, which I don't recommend. It is worthwhile to keep in mind though for entries & exits in long term positions, though.
 
Top