551–560 of 684 posts
Ponzi implies fraud. Bitcoin, by definition, can't be fraud. The protocol and code are open source. We know how it works. If you lose money because it's a speculative bubble that eventually pops, that's because you made a bad bet, not because you were defrauded.
You get rich from crypto by selling, not HODLing.
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Inflation protection for long-term savings is a huge use case.
When people stop buying the latest and greatest machines for Bitcoin mining, Bitcoin's price will crash to zero. It will trigger double-spending attacks, which will undermine trust in the network. Gold doesn't have this problem; so gold is better. Gold has been used to store value for thousands of years, while Bitcoin is a new and experimental technology. It's absurd to say that you would use an experimental technolo…
Nope, you're laboring under a misapprehension. Even if all new compute power stopped being manufactured miners will run their existing equipment. The mining difficulty will plateau and overtime gently decrease as equipment breaks.
Older and less efficient (at computing double SHA-256) equipment can be profitably brought online where the price of electricity to do so is available and other more valuable uses of that energy in that locale are not possible.
You can ride this all the way back down the years and generations of ASICs then GPUs to CPUs. Once humanity is out of CPUs, well, we'll have more pressing issues. We'll talk again then, or not.
Yes, mining and securing the network nevermind transmitting transactions would be difficult with ink, paper, and abacus technology alone. I'd expect gold to hold some value here despite difficulty in securing and assaying it restricting its useble value to technical specialists and institutions. Nonperishable food, water filters, consumable entertaining substances, etc. would be a better bet if you're prepping against a Mad Max level of collapse.
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I'd bet that cryptocurrencies are much more vigorously tracked than US dollars. The fraction of cryptocurrency transactions related to scams, fraud, money laundering, tax evasion, and other financial crime must be at least a couple orders of magnitude higher than that for real money.
This gets to the heart of the issue with these discussions - people like yourself asserting non-factual statements based on the equally (if not more so) incorrect assertions they hear from others. Where are your sources? Why do you feel like you need to state things as fact when you just don't like something? You are exactly incorrect. Cash represents the overwhelming supermajority of laundered funds and ongoing cred…
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My notes so far: https://shawwn.notion.site/Business-Taxes-e9f602855f524618b0... In one of these links, I am quite certain I saw words to the effect of "if you maintain a balance in the business, then the following tax year, it will count as a negative deduction for the shareholders (i.e. you), because the business type is a pass-through entity, and pass-through entities are expected to pass all of their income throu…
> Because yes, it does sound pretty ridiculous that an LLC needs to maintain a $0 balance or else it will penalize the owners of said LLC. That doesn't sound right. It's definitely not correct at all. Neither is issuing phantom invoices to yourself to put money into the account. A bank account is just a vehicle to store business cash, it really has nothing directly to do with the way you should be maintaining your LL…
I may have given the wrong impression, but to be clear I certainly wasn't recommending using Mercury as your tax accounting software! I was saying that as long as income flows into your LLC's bank account, and out into your personal account, and that you never use your business account for personal expenses, then you have nothing to worry about.
I really appreciate the reference on capital accounts; not knowing how to classify inbound transfers from my personal account was bothering me. That still raises the question of whether there is a tax, and how much the tax is. Are you saying there's no income tax when you transfer your personal funds into an LLC, since capital contributions aren't income?
After pausing and searching for the answer to my own question, https://howtostartanllc.com/form-an-llc/contributions-and-di... -- the answer is probably "no, not even slightly" and also "this is suddenly quite complicated."
https://www.legalzoom.com/articles/how-to-add-capital-contri... seems slightly less complicated:
> If you plan to contribute property, you will need to obtain a market valuation to determine the value of the property you are contributing to the LLC. Capital contributions in the form of property may also attract a number of potential tax consequences, so it's generally a good idea to consult with a tax advisor beforehand.
> You also can make a capital contribution in the form of services. As with property, you will need to obtain a market value for the value of your services. There also are tax consequences, as you will have to treat this value as if it were actual income you earned for your services, meaning you will have to pay personal income taxes on the value of these services. Because of this, services are not as popular a form of capital contribution.
So, yes, you can "invoice for services rendered" (aka services capital contribution, apparently) but it'll be taxed as income. Therefore, you want to contribute property, and the tax consequences are left as an exercise to the reader.
Looks like I'll be completing that exercise, but perhaps not at 2:30am.
Cheers for the tips.
EDIT: Two more useful resources:
- https://www.law.cornell.edu/wex/contribution
> The capital contribution increases the owner or partner's equity interest in the entity. Capital contributions are not considered business income unless given in the form of a loan.
- https://ttlc.intuit.com/community/business-taxes/discussion/...
> For a Single Member LLC (that has not made an election to be taxed as a corporation), the IRS does not recognize the LLC exists (for most purposes). Therefore, you and the LLC are the same. Therefore, there really isn't such thing a Capital Contribution for tax purposes.
Apparently "It's complicated(TM)" is still the final answer, because single member LLCs can't have Capital Contributions. Hmm.
One reason I post openly about this sort of thing is precisely because people like yourself come out and correct my misunderstandings. So again, thank you! This is certainly a reminder that I have lots more reading to do.
In a Ponzi scheme, a fraudulent perpetrator takes your money (and the money of many others), gives some of that to early dropouts but takes the rest for himself . Ponzi schemers profit from lying to you where your money goes. With a decentralized digital asset there is no sole person or company that profits from just lying to you about where your Dollar goes in exchange for digitals. Sure, miners and exchanges make p…
> Goods and services provided by humans have no intrinsic value but become precious simply there being demand by other humans. This incorrect. I can purchase a home or food from humans and they have intrinsic value. If whatever market they were purchased on collapses, I simply live in the home and eat the food to realize their value, no further transacting required. Similarly with services I can pay for someone to bu…
If the market for food „collapses“ that means there is too much of it. Its value has gone down because your fellow humans do not want to buy any food from you anymore. Now, you can eat your own food, yes, but if you hoarded too much of it you will have to let the remainders rot away. In this extreme case the value of a good is only given by yourself. So your argument does not contradict the subjective theory of value at all.
On the day nobody cares for Bitcoin anymore, its value will go to _almost_ zero. Maybe some former Bitcoin zealots will keep the blockchain on their hard disks anyway as a memory. Then some subjective value will be left to Bitcoin even then.
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Please look at this data and then come back and tell me you still think Bitcoin mining is having a meaningful impact on climate change and why. https://cbeci.org/index/comparisons I'd be curious to read your thoughts.
So Bitcoin uses more energy than an entire country of 110 million people (the Philippines). That's absolutely nuts. If you said you could reduce an entire country's CO2 emissions to zero overnight, and you had a valid plan to do so, you'd be on the cover of every newspaper for your revolutionary plan to help save the earth. But say you want to flip a switch and turn off a single cryptocurrency in order to do it, and…
Look at the top 3 countries (China, US, India).
Compare those to Bitcoin... can you honestly tell me that Bitcoin constitutes a significant amount of energy consumption in that context?
And it's also worth noting that energy consumption isn't necessarily bad for climate change. You're conflating "energy consumption" with "CO2 emissions". It's CO2 emissions that are the problem, and Bitcoin energy consumption is far more green than most other industries.
So we have a monetary network that consumes a globally insignificant amount of energy and is more green than many other industries... is it really a significant problem?
https://bitcoinmagazine.com/business/bitcoin-energy-use-comp...
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> They do not pretend making your money work for you by some magical scheme. No. They instead take your money, buy coal, and burn it. Nothing is left. As you say, Ponzi schemers take money for themselves and keep it. Most of what Madoff stole was recovered, for instance. Whereas virtually 100% of all money invested into crypto has been burned by miners. This is pretty easy to model. So there’s nothing left to recover…
> Whereas virtually 100% of all money invested into crypto has been burned by miners. This is pretty easy to model. People like Bitcoin's provable global ledger and this is where the value lies. The value is not burned, it's embedded into this ledger.
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Thanks for pointing this out. People have different reasons why they believe in bitcoin (and other cryptos). Where I live the government has in the past 20 years wiped out citizens' savings at least 3 times, arbitrarily, without any notice. In such a situation using bitcoin, regardless of the risk/skepticism, is a far better alternative than having all your money disappear on the whims and or experiments of politicia…
It's sad to hear this. Is there no way for you to buy foreign currency like dollars instead? Bitcoin might be an attractive asset to speculate in, but I'm not sure if it's the safest way to hold onto your wealth, because of its inefficiency, volatility, the need for endless mining to sustain it, and so on. It might multiply your wealth by 10 or reduce it to zero -- do you really want to take the risk? I understand th…
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So Bitcoin uses more energy than an entire country of 110 million people (the Philippines). That's absolutely nuts. If you said you could reduce an entire country's CO2 emissions to zero overnight, and you had a valid plan to do so, you'd be on the cover of every newspaper for your revolutionary plan to help save the earth. But say you want to flip a switch and turn off a single cryptocurrency in order to do it, and…
Scroll down to the bar chart showing the country rankings. Look at the top 3 countries (China, US, India). Compare those to Bitcoin... can you honestly tell me that Bitcoin constitutes a significant amount of energy consumption in that context? And it's also worth noting that energy consumption isn't necessarily bad for climate change. You're conflating "energy consumption" with "CO2 emissions". It's CO2 emissions th…
Are you saying we should compare a digital coin with very niche usage to the collective impact of all of those actions taking place in the most massively populated and economically significant nations to ever exist?
And you're saying it's an insignificant amount of power, yet it consumes more power than an entire nation of 110,000,000 people? There are 110,000,000 people in the Philippines using cash every single day to drive their economy and live. Are there even 100 million people using bitcoin for daily business and consumer transactions involving physical goods? Or even 10 million? Or 1 million?
Is there a reason you're pretty serious about downplaying the impact of electricity equivalent to 110 million people and saying it's not globally significant? Because it's pretty significant. If that many people stopped using all electricity overnight, the impact would be pretty significant. Wiping out the entire Philippine economy would absolutely send shockwaves around the world. That'd be a huge hit to manufacturing and food industries on every corner of earth.
Would Bitcoin suddenly vanishing be more impactful than the Philippines vanishing overnight? Or, to choose a different country from that previous site, The Netherlands?
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Bitcoin is backed by the same thing that backs any currency: public's trust in it, expressed via a price achieved via a market consensus.
You must pay your taxes in national currency. That alone gives it value beyond trust.
(also, such cases is precisely the reason people may believe that they have more trust in bitcoin, as flimsy as it may be, than to their national government issued fiat)