Friday, February 12, 2021

BTC borrowing math question...straining my brain here

This is straining my IQ; can you help with a bit of math? Related to these bitcoin-collateralized loans and a good strategy for me in a lucky year.

I have been putting my monthly home taxes and insurance savings in BTC (at a rate where if I was just saving cash I would have enough after the 12 months...I save it myself because my mortgage is paid off) and obviously have done quite well this year.

Last year I sold from this account for what I paid for the coin as the price had not changed much from my average buy price --- however, this year as you might guess, has been a bit different!

I obviously have quite a multiple of what I put into it, and now I am hearing about bitcoin-collateral loans. About how "the rich borrow money against assets instead of selling it" to not owe capital gains -- and moreover take a deduction from interest paid.

That said, I read the terms from, for example, unchained-capital.com (as it seems one of the only that does not risk your coins lending them, despite the higher interest rate...ok by me) it seems to me I would need to do the following:

On a 10,000 loan --

Pay out ~$91 dollars per month in interest payments. I would pay out of my own monthly income.

Balloon payment of the $10,000 after lets say 12 months.

And now -- this is what I don't get...I don't want to pay capital gains. So I would just hold back the $10k/12 = $833 per month in cash (?) and pay them the cash when the loan is due, hold onto the original bitcoin...

...but NOT buy more bitcoin with that monthly $833 (?) as I have been doing? Because at that point I would need the cash to pay them, but selling Bitcoin to pay the balloon would incur the tax event I was looking to avoid in the first place.

I'd hate to miss more sweet gains not buying -- but I wish to understand the strategy here, and this quickly gets out of hand for me. Any tips or math to offer here? A good plan?

I am very grateful for having had this magic savings account, and if I can preserve value over time like this, that would be absolutely super.

Customers and Phone calls of the day 2/12/2021

I'll try to make these shorter.

830AM: I'm at the diner having corned beef hash and a short stack of pancakes. Breakfast of champions.

845AM: Phone call.

ring ring

FC: Go for FC

1: Oh good! You're open! I'm on my way!

FC: What do you need? I'm eating breakfast at the diner.

Some people like to take a buttermilk pancake and smother it with syrup. They're wrong. What you do is get a little space on the plate, pour the syrup on the plate and dip the pancake in it. You control the syrup better, you don't have soggy pancakes and it's just a much better way of syrup delivery. I don't understand people who can't eat pancakes right.

I shove a bit of my short stack in my gullet.

1: I wanted to stop in and buy some 380!

FC: You're welcome to stop by and I'll tell you I don't have any.

1: WHAT DO YOU MEAN? I've called 30 dealers already and nobody has any!

FC: Welcome to the real world.

I get to my desk and get to work on emails, quotes, generic administrative bullshit that you all don't want to hear about.

10AM: Ortho surgeon comes in from the other day to get more guns and ammo. What started as a transfer from one of my gun show buddy dealers turned into a multi gun multi case of ammo sale and we talk bitcoin, current events and all that jazz. He likes how I think and I can speak his language. I set him up with enough pistols, mags, ammo and jacketed hollowpoints to stave off an angry mob.

Super nice guy, I think we'll get along just fine. He writes in the check memo field 3% 2A 1776. I get a chuckle. I tell him he should see some of my form 4's. He's looking for a surefire mount for his can that he's got in jail at another dealer and I tell him that the mounts are unobtanium and when he gets his stamp he's looking at a batteries not included on christmas day scenario. My honesty seems appreciated.

12PM: Lunchtime. No phone calls of dumbassery. This is weird. Wait. NO PHONE CALLS OF DUMBASSERY. I have left my phone at the diner. Fuck.

Guys, let me give you some advice. Tip waitstaff well. Tip pregnant waitstaff even more. It's cheaper than child support. Jan put my phone behind the counter and I snag it and thank her.

I catch up on voicemails and emails and all that jazz. Guys looking for ammo, guns that nobody can get, etc. I'm told that Gen 4 guns are now out of production much to my skepticism. Whats this mean? Price of the gen 4 just went up.

My business model is simple. I buy when nobody wishes to buy. I sell when nobody wishes to sell, and I get top dollar. I also get called a profiteer, price gouger and part of the problem. The loudest boos come from the cheapest seats. My 1630 pickup walks in super early and I close out his 4473 and get that handled. Maybe today won't be that bad.

2PM: Telemed with Dr Kaplan. I head home and get on telemed. He's gotten the schedule wrong. Instead of Friday at 2PM he put in Thursday at 2PM yesterday. I emailed him to correct it and instead of 2PM on Friday he's put in 4PM on Friday. Yikes. Oh well. I head back to work and get a shotgun pickup done for a lady. It's her anniversary and it's a 3 hour wait on background checks every friday afternoon. She can't wait that long and I don't blame her. I tell her I'll get this done and ready for her next week and to enjoy her anniversary dinner.

3PM: Fedex rolls in with a resupply on ammo. This is unexpected. AND my rep got me two more VP9's for the show this weekend! I don't even bother searching the box, I just throw it with the rest of my gun show stuff and head back home.

4PM: Therapy time. Dr Kaplan is super sorry the scheduling goofed. Pandemic problems, I get it. I tell him about all the shit you people on the internet give me and customers/phone calls, etc. He says I've made tremendous progress.

5PM: Email comes in. Credit card arbitration fraud completed. Visa has resolved the issue. It is not in my favor. I am forced to pay the admin costs of the arbitration ($500+) and absorb the cost of the fraudulent transaction ($500+)

With fraud, credit card holders have little to no liability. This is in theory shifted to the card issuer (read: BANKS) that have fraud reserves that manage the card accounts. In the case of fraud, Visa gives me two options

A: Eat the fraud as we tell you to, you're out the fraud. No recourse.

B: Send it to arbitration, we will FIND A WAY TO STICK IT TO YOU for the fraud, and you're out the fraud and the arbitration admin costs. No recourse.

By the way, all decisions are final. Decide.

The credit card issuing banks are cozy with visa and have fraud reserves, so what Visa does is make it so expensive for small busineses to fight fraud that it's either accept X expense or accept X expense + Y plus Z if you try to stick it to the issuer, who is besties with Visa since they know what side their bread is buttered on........ you get the picture.

It's an expensive week at FC HQ. Fuck this shit.

On Monday I called a guy and told him his background check isn't allowing me to release the firearm. Don't show up. Here's your transaction info if you want to call in and fix things, here's who you got to call. He seems pissed but understands.

On Thursday, the guy calls me up to pick up his gun. He's drove over an hour to get to my place and can't locate it. I tell him I told you not to show up and you showed up anyways? On my lunch break? He says YOU TOOK THE MONEY OUT OF MY ACCOUNT THAT MEANS I GET MY GUN! I tell him I didn't do squat. Here's the info for who you need to call and fix things. Get the government to give me the A-OKAY to deliver and you get your gun. He seems pissed but understands.

Today is Friday. It's 5PM. I get a call from him demanding his money. I don't have his money. He wants to know why he can't get his license. I don't have his license. He wants to know why there's a problem with his firearm license. I tell him there is no problem with his firearm license. He wants to know why he can't get his gun. We go over this one more time. He emails me and asks me for which licensing agency he needs to talk to to get his gun.

I call him back. There's no license issued by the state that lets him get his gun. He says okay okay, he's got it misunderstood. He wants to know the deal with the license issued by the county that lets him get his gun. I say no there isn't a license. He then asks me what he needs to get his federal gun license to get his gun. We go over this one more time and I tell him THERE IS NO LICENSE. CALL THIS NUMBER AND RESOLVE IT. He wants me to give him his money back. This is the third time I've done this this week. I don't have his money. He tells me I took the money right out of my account. I'm ready to tell him his firearm will be sold on consignment, I'm taking 50% as a service charge and problem solved but I keep my cool. I give him the info AGAIN that he needs to talk to the government. This is not my problem. He screams at me telling me he knows that he had a lot of problems and questions on the paperwork but that should not keep him from getting a gun and that I'm railroading him.

All this to make $10.

By the way, this is the guy who got confused on the question that asked "if you are a US citizen leave this blank" - he read it out loud and told me he didn't understand the question.

Fucking hell. I'm done with this. I'll give you the info, don't call me back unless the government gets their stuff worked out.

I unpack the order shipped from Bill Hicks. There's a 6 pack of P320 mags in there.

One of the ladies at the gun club, literally 80 year old grandma CLEANED ME OUT of 40S&W ammo a few weeks ago and she asked me to get her a 6 pack of mags. Because biden comin to take the mags. I told her the warehouse is 3 weeks behind and a week for shipping, so if he does not remember she ordered them - don't be surprised. I can't find her number, I call around to the gun club and I get her number and I call her and tell her her mags are in.

FC: Hi, your magazines are here!

Grams: What magazines?

FC: The mags you wanted me to order you.

Grams: I didn't order any.

FC: You sure? We covered this a few weeks ago, I told you not to forget, I'll charge you when they come in.

Grams: I didn't order any.

FC: Okay, if you don't want them I'm sending them to the gun show.

Grams: What kind are they?

FC: Sig 320

Grams: I don't know what you're talking about.

FC: ooooooohhhhkay. I'll find another home for them.

(9 minutes later, she leaves me a voicemail)

Grams: OH MY GOD WILL! IS THAT YOU! I THOUGHT YOU MEANT MAGAZINES LIKE THE KIND YOU READ! YES I NEED THEM! CAN YOU BRING THEM BY TONIGHT?

FC: Sure.

I drive over to her place and get her her mags. I grab an extra rifle from my stack for the gun show loadout. I've got about 1.75 tables of merch to stretch out and make look good on 2 tables for this weekend.

Between this and denied background guy and the visa fraud bullshit, I'm seriously giving thought to shooting myself with this Sig P220 West German fullsize I keep handy just for these occasions. if only I hadn't sold all my 45ACP Federal HST last week.......

PepeCoin has some serious potential. Deep look and Doge comparison.

After really sitting down and looking at the hype for Doge I was curious if there were other memecoins, and I found PepeCoin. I'm excited to show you guys this info and compare DogeCoin to PepeCoin and prove that PepeCoin is currently superior. This is not financial advice, I am a squirrel breeder.

To begin, we all know how inflated Doge is. With a circulating supply of over 128 billion coins, it would take a market cap of 128 billion to reach a dollar. However the circulating supply is ever increasing. As of right now, the 24H volume for doge is $4.1 million. The current market cap is $9 million. Doge is sitting at an impressive $0.07 right now.

Technically speaking, Doge can hit one dollar but I don't think the general population really understands what it will take with the current status of Doge to actually make it to a dollar. If the people want a memecoin to hit a dollar, why choose such a difficult one to use? Hate hearing people say “it's going to be $10.” DogeCoin’s market cap would have to be $1.28 trillion (that's a lot in case you forgot). IMO that's just too big for such a coin. Would take years if not decades, but i digress.

Looking into PepeCoin on the other hand seems promising. Memetic’s PepeCoin is at a current $25k volume with a $1 million market cap. Total supply is 30.2 million. Pretty good compared to doge if you ask me.

Here is a side by side all time chart of Doge and Pepe. As you can see Doge has been mostly silent all of its life until the recent trend. Pepe on the other hand, has so little volume while already at $.03. Pepe spiked in 2017/2018 to $1.30 with $109M vol and market cap of $25 million. While on top of that, it has recently gained some traction just from recent events. (captured 02/11)

Side by side of Doge and Pepe statistics. Pepe is much smaller than Doge. Meaning that it has the potential to grow a lot faster than Doge. (captured 02/11)

On the 8th, Pepe reached $0.04 with just $39k of volume and Market Cap of $1.2M. Pepe is slowly gaining some traction, and in my opinion, right now is the perfect time for pepe.

For Doge to hit the same $0.04, there was $13.9 in volume with a market cap of $5.2 billion.

Trying to get doge to a dollar is like trying to fill a swimming pool with sand one grain at a time. Getting PepeCoin to a dollar would be effortless in comparison.

If the masses or even a fraction of the Doge community realize how unlikely and difficult it is for them to achieve their goal, some will try to run to another coin. And we saw that when PepeCoin spiked a little over a week ago.

Pepe can work the same way as Doge, as far as having a following goes. It's a meme, just like Doge. It has the trend potential. With Pepe, shibes and the like have something to look forward to today. What is a better embodiment for something wild to occur other than Pepe the fucking frog? Pepe the Frog Meme is just as well known as Doge, arguably even more so. Pepe has gone viral before and it can do it again. It would be so easy for us to buy and hold Pepecoin while and even buying and holding Doge if you are into that. Because Pepe is so much smaller it takes a lot less effort to bring it up.

However, two Problems await ahead:

The biggest problem that is holding back PepeCoin is that it's limited to (1) only a couple of exchanges. One of them being Bittrex (pretty sure it's the only one). People will struggle to convert from places like RH to exchanges like Bittrex which worries me but if Doge and Pokemon Go taught me anything, it's to not underestimate the collective positive mind of earth. (if you are new and move from RH to a crypto exchange, please read up on how to keep yourself secure. There are plenty of tutorials on youtube for this.) Another issue is that you cannot buy Pepe with cash or other AltCoins. (as of right now). On Bittrex, (2) you can only use Bitcoin to purchase Pepe, not a huge hindrance, it just creates an extra step.

I don’t think these problems are hard to navigate around. We all watched thousands of people that never used reddit make an account just to join r/Dogecoin. We watched millions of people who never traded crypto before, make a Binance account or join RobinHood. We watched a trend grow so popular it was being mentioned on television and endorsed by A-List celebrities and praised by Elongated Muskrat. We truly do hold the power in our own hands.

More info:

Pepe is the base for the platform Kekdaq.

PepeCoin Twitter

Subreddit: r/pepecoin

PepeCoin Statistics

DogeCoin Statistics

I want random people like you to be able to pay for school, buy a car, afford hospital bills, pay off debt, get braces, travel, order that bride or whatever the fuck you have been longing for in life that has been hindered by money, I want you to be able to have that opportunity in this lifetime. We are all here early enough to see life changing money happen. I want this to be known to people so we can make this happen for real.

Doge to the moon you say? How about Pepe to Andromeda? Will there ever be a better time?

Let’s not pump and dump it but rather buy and hold just like most are doing with Doge.

“Give us control of a nation's memes and we care not who makes the laws.” - Pepe The Frog

Godspeed my fellow internet goers. Again, this is not financial advice, I am a squirrel breeder.

PEPE - PEOPLE EMBRACING PEACE

Market TA is showing some bullish short term price action, and thus we might see some sudden high highs, but also signs we might be reaching a peak and dip soon. Our previous price channels have opened into wedges, reflecting this volatility. This is usually when I do some profit taking.

Happy valentine's day weekend.

The market is looking pretty frothy after the last dip and run we had. The overall volatility in the indexes is increasing, and starting to open up the price channels we have been reliably trading since Thanksgiving. Opening channels means "widening wedges", which mean big moves will happen - like big'ns. Gut turning, toe curling, make you puke kinda movements. This makes sense as there are two very strong forces in the markets right now: on one side you have the feds continued support and the promise of an unnecessarily large covid relief bill (Cathie's words and I agree: https://www.youtube.com/watch?v=uwajUw4RFVk&t=180s) and future infrastructure spending, and on the other side you have one of most expensive markets in history only rivaled by the late 1920s and dot com eras. People are going to start getting scared and people are going to start over reacting. Remember that anyone actively trading today has only seen this once before at a maximum - the dot com bubble. And yes, this time it is different, the gov is getting ready to ignite the economy with close to 5T of spending over the next two years. And no, it doesn't make holding any easier.

Lets take a look at whats happening so we can plan our next moves. I have added bollinger bands in orange, a 10sma in black, and a 50sma in red to all the charts. When overall chart patterns and trend lines become challenged, as I will show you, these indicators can help you gauge whats happening. The chart below is the Nasdaq 1 day candle chart. You can see the previous price channel in purple that we have been reliably bouncing between since Thanksgiving. Notice the last run broke the top of this channel, and the resulting dip broke the bottom of the channel, and the run we are currently in has broken the upper channel yet again.

Nasdaq 1 day candles

The increasing volatility arguably makes this channel irrelevant given that it has broken three times, though the trend remains intact. The more correct pattern to fit is a wedge, as seen in black in the lines below.

Nasdaq 1 day chart

Do notice in both charts above that we are riding the upper bollinger band, which is extremely bullish price action, and is usually not sustainable for long. Periods of extreme runs like this usually result in prolonged consolidation patterns like we saw in September through November. While that may sound bearish in the long run, the truth is these events can also lead to pretty spectacular breakouts, and this is what I want to turn our focus to: are we going up or down?

Looking at the first chart, we appear to be testing the upper purple resistance line of the channel, and it looks like this could be forming support. However, if you look at the second chart with the wedge, we appear to be bouncing off the upper boundary of the wedge and getting ready to reverse. When you have conflicting TA like this, adjust the window to see what the market is doing now. If we take a look at the 15min candles below instead of the 1 day chart, we can what the market has been thinking for the last few days. The original purple channel still shown, but look at the ascending triangle formed by the green lines. The last 15min period of trading today broke the ascending triangle, which indicates a breakout - meaning we are going up. But I dont see an catalysts on the horizon to drive this...

15min candles nasdaq

This doesn't mean our down side risk is negated. Based on 15 min candles, you can have a serious rally and then huge dump all in the same day, or couple days, particularly if there is no big news to drive a move. The way I am interpreting this is we are likely getting ready to form a grave stone doji in the next couple days, which is when the market opens, rises fast, and the falls back to the opening price, indicating there are no buyers at these prices. Or in other words, we get a breakout on the 15min candles that collapses kinda fast, and forms a doji on the 1 day candles.

By the way, it is very odd to see indexes behaving like this. For indexes, we usually get these nice and slow forming channels that go up on good earnings, down on bad earnings, but somewhat related to gdp and corporate profit growth. We usually get sudden moves down based on global negative news, followed by sudden moves back up once everyone realizes they overreacted; however we it is rare we see such an emotional and speculative market that actual patterns like ascending triangles apply to an index. The psychology is driven by speculation, and to have market-wide speculation on this scale that these patterns show up in the index is beyond wild. Clearly people are thinking the US is ready for some extreme growth.

Anyway, I do not think the fundamentals cannot be overlooked at this point. There comes a point in every bubble when people do the math on company growth and it literally isn't possible for a company to meet it's speculated valuation and it all comes tumbling back down. In our case though, the speculation is warranted due to huge spending bills on the horizon, which is why I think the volatility will continue this winter. So even once we dump, I think we only hit the middle bollinger band or 50sma and then keep on going up. We won't see a huge dip or "pop" if you will unless the spending bills get substantially smaller and significantly delayed... which I do think will happen.

Along this note, Cathie Wood also made a prediction about how much the market would grow this year and she said 20%, but with a lot of turbulence. Lets say we believe that is true - then from Jan 1st 2021 to Jan 1st 2022, the indexes should be about 20% higher this year. If you looked at our progress thus far in the chart below you will notice the RUT is already up 15.9%, the Nasdaq is up 9.4%, the sp500 is up 4.9%, and the DJI is up 2.8%. Here we are six weeks into trading for 2021 and we are almost half way to Cathie's growth target of 20%. If the current trend continues, based on rough calculations the Rut will close the year up 135%, the nasdaq would be up 81%, the sp500 would be up 41%, and the dow would be up 24% - literally every way you could define the market it would massively surpassed all expectations.

4hr candles comparing the relative returns of all indexes.

Fun observation in the chart below, the insane compounding of the dot com bubble did do exactly this. From March 1999 to March 2000 the Nasdaq returned over 110%. Not that is going to happen again. In fact because this has already happened, it almost certainly means it will never happen again. I expect a lot more turbulence and profit taking instead of a literally market-wide 110% rally. So like Cathie said, we will likely have a block buster 20% year, which is monstrous. But based on what we have done so far this year, the turbulence should be poop-your-pants epic.

1 wk candles shows the relative index returns through the dot com bubble.

Lets take a peak at the other indexes. The sp500 is still following the trend of it's prior price channel shown in purple in the chart below - aka unsustainable high growth.

sp500 1day candles.

But what is interesting about the sp500 over the last few days is it has also formed an ascending triangle and initiated a breakout at the end of the day as well.

sp500 15min candles

Again, just like the Nasdaq, the sp500's price action is forming an opening wedge, evidence of the expected turbulence to come.

sp500 1 day candles

The Rut only just now starting to form the wedge pattern, based on the last two dips, and is staying nicely in a steep channel we have seen since November.

Rut 1 day candles.

However, looking at the Rut's 15min candles, we see a downward channel forming over the last three days. Just like the other indexes, the end of the day price action for the Rut did break the top of the channel indicating we might see a breakout to the upside in the near term.

RUT 15min candles.

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One of the things that can help us get a stronger sense of where the market is going is the degree to which people seek "safe havens" or hedge against potential market dips. I have noted in prior TA posts that we can watch these indicators rise in the days leading up to a dip, which indicates a change in psychology. Lets start with the VIX, in the chart below. You can see the VIX has continued to cool off since our last dip on Jan 27th, falling to local lows at the end of the day today. Clearly no one is hedging right now, or expecting significant volatility. While that does act in contrast to my thesis, know that the VIX does not and has never seen as far into the future as it claims to be able to see - its for a couple days at best. The current VIX means investors are expecting the uptrend to continue for the next couple days, which is consistent with my thesis. However, if we breakout and go too high too fast, expect the VIX to start rising in anticipation of a drop.

Vix 1 day candles

People will often flock to TLT during times of market down turns as well, and similar to the VIX this often starts to rise in anticipation of a dump. As you can see in the chart below TLT gaped down, meaning we should not expect a dump now. And note the dollar index has held stable over 90 for the last month too. Also note how large gaps down in tlt are followed by a few days of consolidation and a brief uptrend, during which time the market does dump, which is evident we are likely getting ready to form a peak soon.

TLT 1 day candles

We can also look at gold, and see again the price decreased today. Though I don't think this makes sense to buy until some of the fed spending packages are passed anyway. This is more of an inflation play than anything else.

GLD 1 day candles

Bitcoin is being touted as the new gold, bla bla bla, so I'll show it here for completeness only. BTC is rallying based on TSLA buying 1.5B of it as well as visa saying it will include BTC as payments. BTC is not a "hedge" buy rather a hype play as crypto gets more and main stream. You can play this with leverage via options with MARA and RIOT. Wait for BTC to touch the 50sma and get loaded up on calls.

BTC 1 day candles.

Something I haven't explicitly shown before, but have discussed is the put/call ratio, seen in the two charts below. The first is a 5 year window that gives you some historical reference, and the second is the last three months. Notice the sinusoidal pattern that happens with this ratio over time - the more the market goes up the more puts are bought and vice versa. Our large market dips have been pretty cyclical the last five years, hence the pattern. Also notice we appear to be cresting a peak on the 5 year chart, which does suggest we might be in for a nice dump at some point this year - doesn't mean it will happen this week (I dont think the really big dump will happen until this Spring, I speculate we will see quite a few issues passing some of these spending measures). Now take a look at the three month chart - notice quite a few of the spikes in put buying correspond to market peaks prior to a dump. Also notice more dumps are predicted than actually happen - so grain of salt. Today put buying started to increase a wee bit indicating people are starting to prepare for a possible dip.

5yr put/call ratio.

last 3months put call ratio

Lets now turn our attention to the GEX and the DIX from the dark pools. We have noted that the spikes in the GEX do seem to precede dips, and we got a spike in the GEX today that looks like it might keep going for another day or two. This indicator has been pretty sensitive for us in terms of calling these little 3-5% dips, and depending on where this things peaks at, that is exactly what we might see setting up over the next few trading days (ie peak formation and dip).

https://preview.redd.it/5rhfuee9w4h61.png?width=1292&format=png&auto=webp&s=a5ff98ac5464b4538978909898791090cd3da47f

https://squeezemetrics.com/monitor/dix?

As a final indicator that I think is pretty helpful in terms of understanding some nuances about the market is the CNBC fear and greed meter. It's reading greed today, and quite a bit more greedy than yesterday. However, if you look at the second chart, one of the metrics is safe havens which CNBC defines as bond performance vs stocks. I was surprised to see bonds gaining performance on stocks, not that they are better, just closing the gap. I think it is indicative of investors beginning to prepare for more volatility in stocks. In the third chart, the overall trend with the fear and greed meter is pretty darn bullish, but again, we don't seem to be able to keep this up for more than five quarters before getting a sizable dip.

https://preview.redd.it/fdoielt3a4h61.png?width=656&format=png&auto=webp&s=6864da5d7e730bc8c0af57f7598ecb7dc3d89367

https://money.cnn.com/data/fear-and-greed/

https://preview.redd.it/i97bu0saa4h61.png?width=671&format=png&auto=webp&s=ade12deaa5c8333fd03336da7ea3a74efc8f53d2

https://preview.redd.it/bl5aysoda4h61.png?width=699&format=png&auto=webp&s=f87e6f42752b9e4ec266f6bfca75696c4c238171

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Final thoughts for you

We are way over extended in terms of our current price trajectory. This is not sustainable, even by a very bullish investor's views (Cathie Woods).
Expect a lot of volatility this year. A big dip is incoming, and if I had to guess I'd say late spring or early summer, and it will likely be due to delayed spending bill(s). As Cathie noted in her video (way back at the top of this post), the economy is very strong right now and congress doesn't need to do much of anything. I think delaying the covid spending bill to March, which is what Nancy is doing, will create huge problems and ruin any chances of meaningful legislation being passed this spring. If we get another drop in unemployment as we did this last month, congress will not be able to maintain the narrative of needing more covid support, or needing to pass as large of an infrastructure spending bill as they are currently eyeing. This means the speculative forces driving the market up will take a hit, thus giving way to the "over valued" forces that want to bring the market down.
In the short term, our price channels are degrading and giving way to widening wedges, which means more volatility, per the above explination. While this all seems bearish, what we have on our plate at the moment is quite bullish. We have ascending triangle breakouts forming on the nasdaq and the sp500, as well as low demand for safe haven investments. This means we could see some nice spikes over the next day or so of trading.
Back to the bearish top calling, we are seeing increases in the put/call ratio and GEX starting, meaning there is some degree of hedging taking place. Which is further evidence of a dip in coming.
I do not think the next dip is the "big one". I think this will be another 3-5% dip that we often get. As I explicitly explained in the TA, we are expecting a return to the middle bollinger band or the 50sma and not a 10-20% dump back to the 200sma.

I'm going to start taking profits after this last run up, and start getting a dip list put together. I have been working on calling peaks with the intention of buying vix calls and index puts as a hedge. Once a more clear peak shows it's self, I'll likely enter a few hedge positions as planned.

reference error cant find variable $ | Siri shortcut & scriptable

I have a website (not my own) to earn bitcoins every 60 min. so i have to click on roll button every 60 min .... so i made siri shortcut to do it without opening safari with scriptable. I have the code but when i put the code on google chrom consol its work perfectly and when i put it on sirishortcut i get this error :

reference error cant find variable $

The code i have used :

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No one talks about Mt. Gox anymore

It's just an observation I have made. If you've been in crypto for awhile (and I mean pre-2017), for the longest time, Mt. Gox was the biggest story going, and some thought it was the death knell for crypto, as it showed how easy it was for a large number people to lose their money simply by an exchange screwing things up. I mean, as of right now, Mt. Gox was responsible for the disappearance of over $40 billion dollars worth of their customer's Bitcoin. Mt. Gox was huge, it was the exchange to trade on. It would be like Coinbase suddenly closing up shop tomorrow.

It's fairly amazing to see how things have bounced back since then to the point that it seems like a lot of people have never even heard of it and/or can explain what happened. Such a momentous event, still not fully settled, and it's not really even mentioned anymore. I think it shows the strength of the overall cryptosphere that it's not really talked about anymore.

But in the future, when cryptocurrency has become truly mainstream, I'm sure history books will mention it in detail. It's a funny thought to think people in the future will know more about it than than a lot of people who are active in crypto right now.

Anyway, I was just thinking of Mt. Gox as this year's bull market starts to heat up, and was just wondering how many here actually know what it is without using Wikipedia or another website to look it up. It can be a kind of history lesson, a "Back in my day...." story. Did anyone here actually lose money in Mt. Gox? (For the record, I didn't, as I didn't officially invest until 2015, about a year after all the Mt. Gox shit went down.)

GRST - Ethema Health Corporation - The massive upside potential drug and alcohol treatment facility - Huge DD

If you are tired of being a bag holder or investing in companies that have already soared 750% in the past week. Read this DD. All of it. This is a massive opportunity in a new sector

$GRST :

Share price : $0.0073

Market Cap : 13.44M

What is Ethema Health Corporation? ($GRST)

Ethema Health Corporation (OTCPINK: GRST) operates in the behavioral healthcare space specifically in the treatment of substance use disorders. Ethema developed a unique style of treatment over the last eight years and has had much success with in-patient treatment for adults. Ethema will continue to develop world class programs and techniques for North America.

Ethema Health Corporation (GRST)

$GRST currently has 2 subsidiaries :

Addiction Recovery Institute of america (ARIA)
- Drug and alcohol treatment facilities
- Real estate

https://www.ariafl.com/

COVID CLEAR
- Provides disinfectant(COVID Clear solution) to keep customers, employees, and your family clear of the COVID-19 virus as well as other harmful bacteria and germs
- And CDC guideline training for companies staff allowing them to use FDA approved antibody test

https://www.becovidclear.com/

__________________________________________________________________________________________________

“Okay but why should I invest ?”

The Addiction Recovery Institute of america (ARIA) is why :

“Ethema Health (GRST) has been issued a license from Florida’s Department of Children and Family Services to operate addiction treatment services at its location at 950 Evernia Street, West Palm Beach. The license includes detox, residential, partial hospitalization, intensive out-patient, and out-patient services which allows Evernia to offer a full continuum of care at its location.

$40,000,000.00 in Gross potential income

“How ?”

Evernia Health Center in West Palm Beach, Florida, is one of the facilities that is owned by GRST.
The facility is 21,000 SQ FT and has 168 beds.
Each of the beds in the facility is worth $1,000,000 which equates to a value of $168,000,000.

“Why is a bed worth so much ?”

A single bed in a rehab facility can bring up to $20,000 per month ;

“Standard inpatient addiction treatment facilities cost between $14,000 and $27,000 for a 30-day program, and outpatient treatment can range from free to $500 per session.”

https://www.rehabs.com/addiction/how-much-does-rehab-cost/

“How did I come up with $40,000,000 and what is my p/t ?”

My conservative p/t is $0.12 per share (a 1200% increase) and this is why :

If the facility has a 40m gross potential and is at 90% occupancy(Considering the fact that there is a shortage of facilities and therapists) ; the adjusted annual revenue would be $36,000,000.00

$36,000,00.00

x 25% (Net income based on the high demand and low supply)

$9,000,000.00 in net annual income

With 1.8b of outstanding shares the EPS(earnings per share) would be $0.005

With a PE of 25 the price would then be of $0.12 per share

A 1200% increase!

But let's be honest, in this bull market this will probably skyrocket to 1$+

__________________________________________________________________________________________________

MASSIVELY undervalued compared to other companies

GRST has only 2 competitors in the pure Behavioral Health sector.
- ACHC
- OTRK
Each of them trade on the NASDAQ and are worth billions
- ACHC Market Cap = 4,75b up 75% since august
- OTRK Market Cap = 1,5b up 50% since august
- GRST Market Cap : 15m

The market is exploding and GRST is gonna become the 3rd major option in the $35 Billion addiction treatment industry

https://www.forbes.com/sites/danmunro/2015/04/27/inside-the-35-billion-addiction-treatment-industry/?sh=66aea1cc17dc

__________________________________________________________________________________________________

ARIA Treatment Facility Fully Licensed : Jan. 13, 2021

https://www.otcmarkets.com/stock/GRST/news/story?e&id=1784097

Ethema Health Corporation (OTCPINK: GRST) (“Ethema” “GRST” or the “Company”) is pleased to announce that the audit for the full licensing of the ARIA treatment facility by the Department of Children and Family Service for Florida (“DCF”) which commenced on December 10, 2020 has resulted in the issuance of a full license for all five levels of care that ARIA provides. The issuance of the full licenses for each level of care were staggered and the full licenses for the final two levels of care were received January 12, 2021.

“What does that mean ?”

This granting of the full licenses will allow ARIA to move forward with the pursuit of in-network contracts with various insurers.

ARIA finished November and December with out-of-network gross billing of $602,200.00. The rate paid by insurers on out-of-network billings varies by insurer

“What does In-Network or out-of-network mean ?”

When a doctor, hospital or other provider accepts your health insurance plan we say they’re in network. We also call them participating providers.
When you go to a doctor or provider who doesn’t take your plan, we say they’re out of network.

ARIA has made an impressive $602,200.00 out-of-network just in november/december with a temporary license. But now that they are fully licensed and are able to move forward with contracts with insurers, this could grow much more quickly.

Important!!! :

On november 16, 2020, ARIA received a provider number from a from a massive Health Insurance Company : BLUE CROSS

“The Company is pleased with the progress of the new treatment center operated by Evernia Health Center LLC under the trade name of Addiction Recovery Institute of America (ARIA) and operating ahead of expectations at this very early stage. Aria has received a provider number from Blue Cross well ahead of the time expected and continues to get credentialed by other insurers as applications for reimbursements are submitted.”

https://finance.yahoo.com/news/ethema-releases-third-quarter-results-214000750.html

__________________________________________________________________________________________________

Leonite Capital, a Hedge Fund, is willing to buy 20% of the outstanding shares at $0.10 per share.

https://www.otcmarkets.com/stock/GRST/news/story?e&id=1623620

“1. All existing Leonite Warrants to be exchanged with a new Leonite five year warrant granting Leonite the option to purchase equity up to 20% of the outstanding common shares at $.10 subject to adjustment. Any portion of the warrant that is exercised will reduce the remainder of the warrant remaining based on the total number of common shares outstanding at the time of the exercise. The warrant may not be exercised in the first three months of the warrant term.”

Leonite buying 20% of the OS equates to 368,218,049 shares which equates to $36,821,805 for the transaction.
If Leonite Capital is willing to pay $36,821,805 for something like this they are confident in where the company is going.

__________________________________________________________________________________________________

Shawn Leon is a great CEO

“Why” ?

He believes in the company

Shawn Leon owns and bought 80.4 million shares including some at 0.079$

https://www.secform4.com/filings/792935/0001721868-18-000742.htm

2) He is rapidly growing the company

With 2 recent acquisitions of Addiction Recovery Institute of America(ARIA) and COVID CLEAR both already bringing revenue

3) He cancelled his own shares and reduced the outstanding shares by that number

“The total number of common shares issued was reduced yesterday after the CEO returned for cancellation 1,757,850 shares that were issued to him in the years 2012, 2014 and 2015 (for management fees). The CEO has never sold any shares issued for either management fees or for cash investments over the last twelve years and has not charged any management fees to the Company directly or indirectly in the last two years. The Company will be very strategic with any share issuances going forward.”

__________________________________________________________________________________________________

Debt restructure and major debt has been paid off

https://www.otcmarkets.com/stock/GRST/news/story?e&id=1784097

The Company previously reported the restructuring of the debt due to Leonite Capital LLC (“Leonite”) whereby the bulk of the debt was converted to preferred shares in the Company and one of the Company’s subsidiaries, with the remainder written down to $150,000 (the “Remainder Portion”). Under this agreement the Company and Leonite agreed that there would not be any conversions at any time prior to October 31, 2020 and allowed thereafter. The company received conversion notices to convert the debt to shares and the shares were issued on December 31, 2020 and January 12, 2021 in full satisfaction of the Remainder Portion of the Leonite debt.

__________________________________________________________________________________________________

Labrys Fund LP is buying 100,000,000 GRST shares

https://www.otcmarkets.com/stock/GRST/news/story?e&id=1763638

Ethema Health Corporation (OTCPINK: GRST) (“Ethema” “GRST” or the “Company”) filed a comprehensive 8-K today summarizing all previously announced debt settlements and new financings entered since May 15, 2020. This filing will be used as a reference for the upcoming Regulation A filing. The previously announced term sheet for a new financing with Labrys Fund LP was concluded and the final warrants issued in conjunction with the financing were much more favorable to the Company. The final warrant was for 100,000,000 shares instead of 183,333,333 and the exercise price was $0.00205 instead of $0.0015.

8-K : https://sec.report/Document/0001721868-20-000600/

__________________________________________________________________________________________________

Positive free cash flow

The Company CEO, Shawn Leon, stated, “With these two events, the Company has positively impacted cash flow over the next three months by over $325,000.00.

__________________________________________________________________________________________________

The biden plan to end the opioid crisis

https://joebiden.com/opioidcrisis/

“Make effective prevention, treatment, and recovery services available to all, including through a $125 billion federal investment”
Biden knows that the most important step we can take to address substance use disorders is to ensure that Americans have access to affordable, high-quality health care, including treatment for mental illnesses and substance use disorder. That’s why Biden has a plan to build on the Affordable Care Act and achieve universal coverage. In addition, Biden will redouble efforts to ensure insurance companies stop discriminating against people with behavioral health conditions and instead provide the coverage for treatment of mental illness and substance use disorders that patients and families need__________________________________________________________________________________________________

No reverse split + No more dilution

https://insiderfinancial.com/ethema-health-grst-a-ground-floor-opportunity/180582/

No reverse split

No more dilution

__________________________________________________________________________________________________

Not a cannabis play

https://insiderfinancial.com/ethema-health-grst-a-ground-floor-opportunity/180582/

The behavioral health sector (addiction treatment) hasn’t gotten a lot of coverage compared to cannabis, bitcoin and EV sectors. Ethema Health is the first pure-play opportunity that represents a ground floor opportunity in a multi-billion-dollar industry

__________________________________________________________________________________________________

GRST is ready to acquire more companies

GRST already has 2 subsidiary companies but is ready to acquire more companies with funding from Form 1-A under Regulation A.

*More companies means more revenue

https://www.otcmarkets.com/stock/GRST/news/story?e&id=1763638

__________________________________________________________________________________________________

FLORIDA ADDICTION TREATMENT CENTER TOUR

https://www.ariafl.com/about-addiction-recovery-institute-of-america/florida-addiction-treatment-center-tour/

https://preview.redd.it/q73iwfocy3h61.png?width=467&format=png&auto=webp&s=277224090c353543fb8d88ca660024c62d7114f8

https://preview.redd.it/vdhw7ccdy3h61.png?width=493&format=png&auto=webp&s=0055bf394f1d2d7eb7f5afcaf6db9f746879120d

https://preview.redd.it/367iuczdy3h61.png?width=538&format=png&auto=webp&s=40b8cd4926ff3c979b7ddac7e4278bcd161092e5

https://preview.redd.it/zi7ul1key3h61.png?width=498&format=png&auto=webp&s=5e3d17b57db440f3af0ff31176abc19710f6e652

https://preview.redd.it/pe3k4z5fy3h61.png?width=507&format=png&auto=webp&s=9059dee30171d7ae572973b6b47f8802cc1334ed

__________________________________________________________________________________________________

Technical analysis

Technical analysis by ilovestock85

https://www.tradingview.com/chart/GRST/0FzvCk1E-GRST-UPDATED-ANALYSIS/

$GRST: After a successful breakout from the cup and handle formation above .003/.0042, $GRST reached highs nearing the psychological level of . 01 , and leveled off to retest the uptrend and found solid support at the breakout levels from the previous formation. We are now swinging back to retest the penny level, and when broken this time around we should see a parabolic move towards .03, many new developments including $grst going current on otc markets, aria facility receiving its license and opening its doors to patients. much more marketing is coming from the company to promote the facility and begin generating revenues.

Technical analysis by LOVE*PINK

__________________________________________________________________________________________________

TLDR? : This stock is gonna explode and 1 cent/share is nothing compared to what is about to happen

P/T anywhere from 0.12 to 1$

__________________________________________________________________________________________________

Credit :

Stervc https://investorshub.advfn.com/boards/profilea.aspx?user=1551

LOVE*PINK https://investorshub.advfn.com/boards/profilea.aspx?user=135840

Thank you guys for the deep DD

__________________________________________________________________________________________________

I'll answer questions in the comments

Beware of DEFICHANE knock off

Intro

I appreciate DEFICHAIN project and I am not trying to hurt this community in any way, but to bring awareness about a knock off called DEFICHANE that tries to scam people.

How I came to know about this

I am party of a community that organizes educational events about cryptocurrency and supports new coming blockchain solutions. Today I have received a message from a person infiltrated in this community with a promo code in value of 0.5 BTC for DEFICHANE. It sounded too good to be true but I thought about checking it out. I registered on their website and inserted the promo code, receiving those 0.5 BTC as promised, but after that things got strange.

Nothing is for free

First thing I tried is obviously to withdraw this funds, but the exchange stated that you need to have deposited 0.02 BTC before in order to comply with legal regulation of tracking crypto assets. Isn't that strange? Haven't seen this kind of absurd requirement before.

Transfer is failing

Second thing I have tried is to make a transfer to a personal wallet, both on the Bitcoin and Ethereum blockchain, but the transfer failed with reason that my account doesn't have this option, but without further explanation.

Investigate the exchange

DEFICHANE false statements

Like anyone else would do I searched about DEFICHANE in different search engines, but haven't found anything about it. If you look on their website, they state that they exist since 2017 and have over 1 mil users. How is this possible and not find any information online about it or anyone referencing it?

Obvious alert

If you searched for defichane.com on urlvoid.com, you would find that the domain has been bought from namecheap.com 7 days ago: Creation Date: 2021-02-06T16:44:52Z. Again, isn't that strange given that they were supposed to exist since 2017?

Their cover-up

After my initial search some info appeared online about DEFICHANE on BTCNEWS.ONE, which I have reasons to believe is faked up, but won't go into details. The 2 articles that are available about DEFICHANE don't have anything to do with it. One is related somehow to to defichain, but it is incoherent, missing the context. That just pust some jargons in and victims might see it and believe it is all legit.

Conclusion

DEFICHANE is a scam that tries to convince people to deposit $1000 with the "proof" that they will be able to withdraw over $20,000. Keep in mind, if something is too good to be true, then most likely is fake.

PS: I apologise for making this so long, but I hope this will help people stay await from it. It hurts me to see that no matter the technology, there will always be greedy people that will use it in a harmful way. Hope this helps! Cheers!

#wXRPmovement I locked in $100. Now it is Y/OUR turn #XRP

Yes, you did read the title correctly. I just bought $100 more worth of XRP without worrying to lose but more excited to gain good returns on my investment.

Before I give further info on the post; I would like to introduce myself to you. I have been working as a web developer and social media consultant for 10 years. Recently joined to cryptocurrency world since we are all locked down at home. So far so good; my understanding of cryptocurrency helped me to gain with my current portfolio.

I copied and attached a part of my analysis which I use while adding coins to my portfolio. I work a similar way for all the coins that I am interested in. I only copied Cardano and Polkadot from my prediction list as they have similar market caps. Otherwise, my list goes on.

By the way I am one of the early joiners of the Dogecoin movement. So, I saw it happening here that Reddit does the trick for such ideas. Yes, we are an EMPIRE. It is an idea that the community creates and it goes on if more of us agree on the same idea. That’s why I opened this account; to share my idea with you. I did spend some time putting it as clear as possible. So please listen up J

Have you read everything up to this point? Take a breath; we are starting.

There are 2 cases which may happen to XRP after Sec court which is on 22nd of February. Lose or win right? Simple. We will come to this point at a later stage again. First, let me explain to you what would happen if there was no court case at all? I mean, imagine that it never happened. Let’s check it out.

What would happen if there is/was no court case?

After all we are all aware that the cryptocurrency market had a recent push up which was mainly caused by Bitcoin and Etherium. This also helped other coins / altcoins to move up. If there was no court case; XRP would be somewhere around $40-50 Trillion market value which would make it fair compared to the other 2 coins Polkadot and Cardano. So, this market value would make our XRP around $1,00 as in the value of today if there was no court case at all.

Now please understand the above paragraph. Take a second break and continue to read.

The SEC sued Ripple in December 2020, alleging the company, CEO Brad Garlinghouse and Chairman Chris Larsen sold over $1 billion in XRP, promoted the token, and paid third parties to support the cryptocurrency as you may know in details.

Now this case comes from a long way. So, I won't get into details. I assume we just have to wait to see the court’s decision.

After giving you un/necessary information above J I will get to explaining (Win or Lose) cases and hopefully to start our movement with whole reddit community.

Losing the court case?

Undeniably, with a good tech team, major investors, and links to traditional financial institutions, XRP can be stated as one of the top crypto currencies. So after court; XRP will still be there for sure. But it will either fined; pay it and try to move on or will be shaped as a stable coin which is well deserved by our XRP. You cannot denny its features and community (us). Therefore, no one sees it as getting disappeared! In this case we would see a max of $1,00 per coin in return. And considering its market cap it also wont go down much from its current value. Unless it is shut which is again almost impossible.

Winning the court case?

My hands are a bit shaky while writing this title. XRP is a big community, it has good things behind it which may also lead their legal team to win the case. The allegation date goes back to 2013. So anything may happen.

Lets think what would happen after this. First, it would lead XRP to get a deserved market cap which will double up easy; comparing to recent ups and downs of other coins in January. This will first push XRP to a stable position on the ranking. I expect this to take couple of days similar to Bitcoin’s Tesla investment reaction. We may see it around $2,00 - $3,00 at this point. What happens next? With the right leading from its brilliant tech team and investors, it could go anywhere. Imagine yourself. $5,00 would be realistic but it could well go up to $25,00 depending on various factors including its volume which will be again in control of our hands as an empire J So who doesn’t want to be there after we make all this happened?

Thinking under above circumstances and kick our movement START; I invested $100 which is the exact amount I spend for cigarettes monthly J So, I can afford it. Invest only what you can afford to lose under this movement. Not more not less! You may join the movement event with $1,00 investment. We are only strong in numbers. So just join the movement with any amount.

Moving up to $1,00 is important! (KEY POINT)

I know the power of Reddit and social media. Therefore I believe we have to push dear XRP to $1,00 before the court date and avoid unnecessary loss time to get our gains back in shorter-term and let XRP rise up itself after that! Also to be strong by numbers as individuals will help the platform to be stronger in many aspects. So, we have 10 days to make our first step happen. Make your investments before 21 of February 2021. And do not forget to get others to know about our movement. Social media, phone calls, any communication will help.

You may copy the text from below also write your own thoughts on social media with #wXRPmovement as well as commenting your amount to movement down in comments if you agree and already joined us.

“ #wXRPmovement I locked in $100 Now it is Y/OUR turn. #XRP ”

PS: I am new writing on Reddit, so I appreciate if some of high ranks help this post to be seen. Up pleaseee. I was also not able to create a community on Reddit since my account is new. Of course, only if you agree and support our movement.

PS2: Will you be a newcomer to Crypto world after reading this post on Reddit? Very good. Start with joining us with whatever you can afford to lose. Wait until 22nd of February and see what is next. It may well be a good starting investment.

PS3: You don't have to agree with me 100% or you can't invest today. Don’t worry. Please do us a favor and share our movement on social media!

PS4: I think Bitcoin will hit 50k all the time high before the court date. Can you imagine the impact of it to the whole crypto world?

PS5: I hope you will like the cat.

PS6: I will be owning 569 XRP while posting this. I will be holding and hodling until further notice J

PS7: You may think I am crazy. It is okay. Sometimes I get high ahhjjhhsjaj. Let's discuss how crazy I am on telegram, twitter etc u/wxrpmovement J

I hope enough of you will join me at least to start it which then probably unstoppable for a while from 22nf of February. Will be interesting to watch. Well, let's see… Lots of love from London

#wXRPmovement I locked in $100. Now it is Y/OUR turn #XRP

Yes, you did read the title correctly. I just bought $100 more worth of XRP without worrying to lose but more excited to gain good returns on my investment.

Have you read everything up to this point? Take a breath; we are starting.

What would happen if there is/was no court case?

Now please understand the above paragraph. Take a second break and continue to read.

Now this case comes from a long way. So, I won't get into details. I assume we just have to wait to see the court’s decision.

After giving you un/necessary information above J I will get to explaining (Win or Lose) cases and hopefully to start our movement with whole reddit community.

Losing the court case?

Winning the court case?

Moving up to $1,00 is important! (KEY POINT)

You may copy the text from below also write your own thoughts on social media with #wXRPmovement as well as commenting your amount to movement down in comments if you agree and already joined us.

“ #wXRPmovement I locked in $100 Now it is Y/OUR turn. #XRP ”

PS3: You don't have to agree with me 100% or you can't invest today. Don’t worry. Please do us a favor and share our movement on social media!

PS4: I think Bitcoin will hit 50k all the time high before the court date. Can you imagine the impact of it to the whole crypto world?

PS5: I hope you will like the cat.

PS6: I will be owning 569 XRP while posting this. I will be holding and hodling until further notice J

PS7: You may think I am crazy. It is okay. Sometimes I get high ahhjjhhsjaj. Let's discuss how crazy I am on telegram, twitter etc @ wxrpmovement J

I hope enough of you will join me at least to start it which then probably unstoppable for a while from 22nf of February. Will be interesting to watch. Well, let's see… Lots of love from London

Weekly Crypto Digest: Rally Unpaused with New ATHs

Happy Lunar New Year to everyone celebrating! As the traditional greeting goes, we wish you prosperity. Tesla investment made sure the crypto market is already making this true. As for other news, read our weekly crypto digest to make sure you are caught up on everything that happened! We rounded up the market movements, latest events and Bitcoin digest for your convenience.

https://changehero.io/blog/crypto-digest-rally-unpaused-with-new-aths/

#CHDigest

https://preview.redd.it/rwjfwcg7v2h61.png?width=719&format=png&auto=webp&s=f6d19441055f1d4607ae820b4146c3974d49b8b2

I want to use bitcoin as currency. What are the tax ramifications in the US?

Title basically. I currently buy Bitcoin from cashapp and store on electrum wallet.

I would like to use Bitcoin as currency so that instead of just buying in with what I can spare, I'm buying in with a larger portion of my income. (Not going all in).

With using Bitcoin as a currency each transaction where I convert Bitcoin to USD will potentially be a taxable event correct?

How is capital gains tax determined? Let's say I bought some coin at 18k then again at 25k then again at 40k. Now I make multiple purchases over a week at current value around 47k.

FaucetCrypto: Double Coin Event!

FaucetCrypto is having a double coin event for the next 20 hours! Earn double coins fast and redeem for your favorite cyrpto.

Feel free to ask me any questions!

Current Coins: Bitcoin Cash, Bitcoin Sv, Bitcoin, Bittorrent, Dash, Digibyte, Dogecoin, Ethereum Classic, Ethereum, Komodo, Litecoin, Piratecash, Pivx, Reddcoin, Ravencoin, Syscoin, Tron, Verge, Zcash, Horizen

Here's my referall link to help us both out!

https://faucetcrypto.com/ref/696448

The expert urged the SEC to check Elon Musk for manipulation of the crypto market

Economist Nouriel Roubini is confident that the SEC needs to study the legality of the actions of the Tesla CEO Elon Musk for manipulating the cryptocurrency market. The expert criticized Musk, who recently wrote on his Twitter page about BTC and DOGE. Against this background, the cost of crypto coins grew sharply.

It also became known earlier that Tesla acquired bitcoins for $1.5 billion. All these events drew sharp criticism from Roubini.

“It's irresponsible and it's market manipulation. The SEC should be looking into people that have a market impact that manipulate the price of assets. That's also criminal behavior, ” the economist said.

According to Roubini, the CEO of MicroStrategy Michael Sailor is also behaving "irresponsibly" by investing a significant share of the company's reserves in BTC, despite its volatility.

Great deals for 2/12, including HomePod Mini, Mate, & more

I looked through over 810 deals and curated over $310 in savings for you. Savings for the win! If I've saved you money, would you kick back a portion and support my work and invite me to coffee?

Amazon Tech Deals for 02/12: ⠀ - Today's Amazon tech deals include:

Apple M1 MacBook Pro: (8% off, save $100)
Apple Watch Genuine Leather Replacement Band: (33% off, save $4)

Prices subject to change, so check MDM Deals to see pics, full info, current prices, & links.
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Forgotten lessons of 2008 that are even more relevant today

In 2010 legendary investor and founder of the Baupost Group Seth Klarman described in his annual letter 20 lessons from the financial crisis which were either never learned or else immediately forgotten by most market participants. With him at the helm the Baupost Group has averaged around 18% and that since 1982 - a spectacular return. Some of these lessons are even more relevant today. I took the most important ones and updated it for the current market.

Things that have never happened before are bound to occur with some regularity. You must always be prepared for the unexpected, including sudden, sharp downward swings in markets and the economy. Whatever adverse scenario you can contemplate, reality can be far worse.

Nassim Taleb calls these “Black Swans”: an event that comes as a surprise, has a major effect, and is often inappropriately rationalized after the fact with the benefit of hindsight. Examples would be the Internet, the personal Computer, World War I, the dissolution of the Soviet Union, 9/11 and of course the Coronavirus.

These all changed countries or continents for decades. With shutdown still in place in several countries in the world the economy’s output is much lower than it was at the end of 2019 - yet we reached an all time high in the stock market. New Mutations are evolving and there might be a sharp downturn in the future or there might not. History taught us that market crashes are much more common than we think. So it is important to be diversified in different asset classes, industries and countries to be protected against those changes.

When excesses such as lax lending standards become widespread and persist for some time, people are lulled into a false sense of security, creating an even more dangerous situation. In some cases, excesses migrate beyond regional or national borders, raising the ante for investors and governments. These excesses will eventually end, triggering a crisis at least in proportion to the degree of the excesses. Correlations between asset classes may be surprisingly high when leverage rapidly unwinds.

With interest rates in Europe being partly negative and extremely low in the US, people are lulled into borrowing to get onto the Party of rising stocks, and that on margin. Margin on Portfolio reached an all time high in December of 2020 and the number of retail traders thanks to Robin Hood exploded even with the recent controversy. In addition - central banks in Europe and the US are printing money like there is no tomorrow. These money policies have driven stocks to a new high. And the excess of government debt mirrored that progression. Action always have consequences - but however harsh they may be one thing is certain: If the current price is higher, the returns won’t be as great in the future.

Nowhere does it say that investors should strive to make every last dollar of potential profit; consideration of risk must never take a backseat to return. Conservative positioning entering a crisis is crucial: it enables one to maintain long-term oriented, clear thinking, and to focus on new opportunities while others are distracted or even forced to sell. Portfolio hedges must be in place before a crisis hits. One cannot reliably or affordably increase or replace hedges that are rolling off during a financial crisis.

We all chase profits, that is just how it is. However conservative positioning and a long-term oriented perspective is crucial. Most people in 2000 thought they would buy the dip when their favourite stocks started to decline, however the decline didn’t stop. The Nasdaq posted a loss of 77%, which would take 15 years to regain the dotcom bubble. During the financial crisis many couldn’t sell their stock because there were no buyers - even retail investors that thought they could get out couldn’t.

During it Janus Funds were similar to ARK today. Investing in modern technology companies and industry they were one of the top cutting edge technologies. Janus were lauded as great money managers but the end of the bubble resulted in brutal loses. Cathie Wood is one of the smartest investors today, but one has to keep in mind the inherent risk that comes with her investment strategy.

Similarly we saw extreme loses in GME. Chasing after returns purely on performance will not result in great results.

Risk is not inherent in an investment; it is always relative to the price paid. Uncertainty is not the same as risk. Indeed, when great uncertainty – such as in the fall of 2008 – drives securities prices to especially low levels, they often become less risky investments.

This is the quintessential art of investing. Your returns will entirely depend on what price you paid. Microsoft was a great company, but buying it during the dotcom bubble would leave you 15 years with no returns and several other well known companies like Cisco or Intel never reached their dot-com peak. Your returns are entirely dependent on the price you pay and so is the risk factor.

Do not trust financial market risk models. Reality is always too complex to be accurately modeled. Attention to risk must be a 24/7/365 obsession, with people – not computers – assessing and reassessing the risk environment in real time. Despite the predilection of some analysts to model the financial markets using sophisticated mathematics, the markets are governed by behavioral science, not physical science.

Because of this behavior we see certain securities being extremely highly valued like Zoom at the moment and certain sectors being very depressed like oil until recently. Yet oil is seen as extremely risky, even though the projected use of oil will increase in the next 10 years. That means that you can find bargains all the time. Those bargains are declared risky - while the overvalued stocks are declared safe. Microsoft after the dotcom bubble only recovered in 2016. 15 years of no gains at all - yet now Microsoft is treated like a company that will be a great stock forever. It is a great company, but the same was thought about companies like Polaroid or Kodak - we saw how it turned out.

Do not accept principal risk while investing short-term cash: the greedy effort to earn a few extra basis points of yield inevitably leads to the incurrence of greater risk, which increases the likelihood of losses and severe illiquidity at precisely the moment when cash is needed to cover expenses, to meet commitments, or to make compelling long-term investments.

This can be highly dangerous and I see it all the time here on reddit. Someone wants to use the money in 3-5 years to buy a house, yet instead of proposing a portfolio that is safe and diversified in several asset classes, most propose a stock only portfolio and sometimes even sector or ARK ETFs. Research has shown that a stock only portfolio will beat pretty much every other asset allocation - that is over the long term. Due to the ups and downs of the market it doesn’t guarantee returns in 3-5 years or even worse can lead to loses. From 1929-1954,1973-1982 and from 2000-2013 the S&P 500 has shown long stretches of no absolute return. Investing before a correction that you cannot foresee would result in either big loses or in the inability to purchase that house - often both. So be conservative when you need the money.

The latest trade of a security creates a dangerous illusion that its market price approximates its true value. This mirage is especially dangerous during periods of market exuberance. The concept of "private market value" as an anchor to the proper valuation of a business can also be greatly skewed during ebullient times and should always be considered with a healthy degree of skepticism.

This is especially true today. Many stocks are currently at outrageous prices. I don’t talk about the FANGMAN stocks - these have great growth and while still being historically overvalued not outrageously so. Several EV/Green/Biotech/Weed/Technology stocks are seen as the next big Google without decent cash flows and while competing in the same space.

This is especially true for unprofitable companies at the moment. According to Joel Greenblatt: If you bought every company that lost money in 2019 that had a market cap over $1 billion, and so they’re about 261 companies, you’ll be up 85 percent so far until today. Something like that won’t be sustainable.Looking at the fundamentals behind the business often makes it clear how unreasonable some of these numbers are - and what returns should be expected of them (often negative)

You must buy on the way down. There is far more volume on the way down than on the way back up, and far less competition among buyers. It is almost always better to be too early than too late, but you must be prepared for price markdowns on what you buy.

We saw that during the financial crisis and also again in 2020. Those that bought on the way down were generously rewarded. You never know when the bottom will hit especially since everyone will run around in panic like a beheaded henn. Researching the fundamentals of a company one can score great businesses for cheap. However they might go down a bit in the short term due to market panic.

Financial innovation can be highly dangerous, though almost no one will tell you this. New financial products are typically created for sunny days and are almost never stress-tested for stormy weather. Securitization is an area that almost perfectly fits this description; markets for securitized assets such as subprime mortgages completely collapsed in 2008 and have not fully recovered. Ironically, the government is eager to restore the securitization markets back to their pre-collapse stature.

As SPACs and Bitcoin dominate the current market this warning is very important. SPACs and the companies behind them haven’t had the greatest return over the long term. With the explosion of SPACs going public, chances are high that those financial products can be very dangerous. Add the risk that SPAC managers often get big compensation packages and try to hide information to increase the price (DOJ Investigation from Clover), these investments should be taken with the utmost caution. Not only that but they also compete in the same space.

The same applies to bitcoin. While I believe that cryptocurrencies will have a bright future, they have yet to be tested during prolonged market downturn where the market was negative not just a few week but several months or even years. No one know what the price will be then and some investors might wake up to a bad surprise. It is important to know these risks.

Ratings agencies are highly conflicted, unimaginative dupes. They are blissfully unaware of adverse selection and moral hazard. Investors should never trust them.

That what makes short seller research so important. While there are a lot of crocks in the financial market (both on the long and the short side), these people often find what the rating agencies or investment banks ignore. If you invest into a company and there is a short report don’t dismiss it - often they include information that was previously overlooked.

Be sure that you are well compensated for illiquidity – especially illiquidity without control – because it can create particularly high opportunity costs.

The OTC market absolutely exploded in 2020. Many of these are highly illiquid. Be prepared for the risk.

Beware leverage in all its forms. Borrowers – individual, corporate, or government – should always match fund their liabilities against the duration of their assets. Borrowers must always remember that capital markets can be extremely fickle, and that it is never safe to assume a maturing loan can be rolled over. Even if you are unleveraged, the leverage employed by others can drive dramatic price and valuation swings; sudden unavailability of leverage in the economy may trigger an economic downturn.

Everyone takes debt at the moment. It is so cheap that many companies use debt to do buybacks or otherwise increase their price. Other people trade on margin and governments don't seem to care about debt. That can be highly dangerous. No one can control interests rates over the long run and bankruptcy is the most surefire way to delete any investment returns. Peter Lynch said: “If you have no debt it is very hard to go bankrupt”. While businesses with little or no debt might not rise to the same degree, they will reduce the chance of a wipeout significantly.

When a government official says a problem has been "contained," pay no attention.

The government – the ultimate short-term-oriented player – cannot withstand much pain in the economy or the financial markets. Bailouts and rescues are likely to occur, though not with sufficient predictability for investors to comfortably take advantage. The government will take enormous risks in such interventions, especially if the expenses can be conveniently deferred to the future. Some of the price-tag is in the form of back- stops and guarantees, whose cost is almost impossible to determine.

We saw that in March the Fed stepped in and bailed out the market. A decrease in interest rates and intense money printing. However the question is: How long can it continue and what will happen to those expenses in the future? All action has consequences and we saw that some of them can end quite bad.

Seth Klarman also added some false lessons, that are relevant without commentary.

False Lessons

There are no long-term lessons – ever.
Bad things happen, but really bad things do not. Do buy the dips, especially the lowest quality securities when they come under pressure, because declines will quickly be
There is no amount of bad news that the markets cannot see past.
If you’ve just stared into the abyss, quickly forget it: the lessons of history can only hold you back.
Excess capacity in people, machines, or property will be quickly absorbed.
Markets need not be in sync with one another. Simultaneously, the bond market can be priced for sustained tough times, the equity market for a strong recovery, and gold for high inflation. Such an apparent disconnect is indefinitely sustainable.
In a crisis, stocks of financial companies are great investments, because the tide is bound to turn. Massive losses on bad loans and soured investments are irrelevant to value; improving trends and future prospects are what matter, regardless of whether profits will have to be used to cover loan losses and equity shortfalls for years to come.
The government can reasonably rely on debt ratings when it forms programs to lend money to buyers of otherwise unattractive debt instruments.
The government can indefinitely control both short-term and long-term interest rates.
The government can always rescue the markets or interfere with contract law whenever it deems convenient with little or no apparent cost. (Investors believe this now and, worse still, the government believes it as well. We are probably doomed to a lasting legacy of government tampering with financial markets and the economy, which is likely to create the mother of all moral hazards. The government is blissfully unaware of the wisdom of Friedrich Hayek: “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.”)

Hope you enjoyed my little writeup. Feel free to post any questions!