{"id":99570,"date":"2020-10-28T17:38:00","date_gmt":"2020-10-28T14:38:00","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/opinion-want-to-retire-rich-on-bitcoin\/"},"modified":"2020-10-28T17:38:00","modified_gmt":"2020-10-28T14:38:00","slug":"opinion-want-to-retire-rich-on-bitcoin","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/opinion-want-to-retire-rich-on-bitcoin\/","title":{"rendered":"#\n  Opinion: Want to retire rich on bitcoin?"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a36725b5198f\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a36725b5198f\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/opinion-want-to-retire-rich-on-bitcoin\/#Digital_currencies_are_so_popular_that_you_can_hold_them_in_a_variety_of_retirement_accounts\" >Digital currencies are so popular that you can hold them in a variety of retirement accounts<\/a><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/opinion-want-to-retire-rich-on-bitcoin\/#Spot_the_%E2%80%98inflation_hedge\" >Spot the &#8216;inflation hedge.&#8217;<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/buradabiliyorum.com\/en\/opinion-want-to-retire-rich-on-bitcoin\/#Brett_Arends\" >Brett Arends<\/a><\/li><\/ul><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<p>&#8220;<strong>#<br \/>\n  Opinion: Want to retire rich on bitcoin?<br \/>\n<\/strong>&#8221;<\/p>\n<h2 class=\"article__subhead\" itemprop=\"alternativeHeadline\"><span class=\"ez-toc-section\" id=\"Digital_currencies_are_so_popular_that_you_can_hold_them_in_a_variety_of_retirement_accounts\"><\/span>\n  Digital currencies are so popular that you can hold them in a variety of retirement accounts<br \/>\n<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><\/p>\n<div class=\"column column--full article__content\">\n<div id=\"js-article__body\" class=\"article__body article-wrap at16-col16 barrons-article-wrap\" itemprop=\"articleBody\" data-sbid=\"WP-MKTW-0000047598\">\n<div class=\"barrons-article-ad-wrapper\">\n<div data-track=\"barrons-article-ad-wrap\" class=\"barrons-article-ad sticky_item\">\n<div class=\"barrons-main-article-ad-target sticky_target body_ad\" aria-hidden=\"true\"><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<div data-layout=\"inline\n              \" data-layout-mobile=\"\" class=\"\n        media-object\n        type-InsetMediaIllustration\n          inline\n  article__inset\n        article__inset--type-InsetMediaIllustration\n          article__inset--inline\n  \"><\/p>\n<figure class=\"\n        media-object-image\n        enlarge-image\n        renoImageFormat-\n        img-inline\n        article__inset__image\n      \" itemscope itemtype=\"http:\/\/schema.org\/ImageObject\"><\/p>\n<div style=\"padding-bottom:62.03124999999999%;\" data-mobile-ratio=\"62.03124999999999%\" data-layout-ratio=\"62.03124999999999%\" data-subtype=\"\" class=\"image-container  responsive-media article__inset__image__image\">\n        <img decoding=\"async\" srcset=\"https:\/\/images.mktw.net\/im-250842?width=140&amp;size=1.6120906801007557 140w,\nhttps:\/\/images.mktw.net\/im-250842?width=540&amp;size=1.6120906801007557 540w,\nhttps:\/\/images.mktw.net\/im-250842?width=620&amp;size=1.6120906801007557 620w,\nhttps:\/\/images.mktw.net\/im-250842?width=700&amp;size=1.6120906801007557 700w,\nhttps:\/\/images.mktw.net\/im-250842?width=860&amp;size=1.6120906801007557 860w,\nhttps:\/\/images.mktw.net\/im-250842?width=1260&amp;size=1.6120906801007557 1260w\" sizes=\"(max-width: 140px) 100px,\n(max-width: 540px) 500px,\n(max-width: 620px) 580px,\n(max-width: 700px) 660px,\n(max-width: 860px) 820px,\n1260px\" src=\"https:\/\/images.mktw.net\/im-250842?width=620&amp;size=1.6120906801007557\" data-enlarge=\"https:\/\/images.mktw.net\/im-250842?width=1260&amp;size=1.6120906801007557\" alt=\"\" title=\"Spot the 'inflation hedge.'\"><\/div><figcaption class=\"wsj-article-caption article__inset__image__caption\" itemprop=\"caption\">\n<h4 class=\"wsj-article-caption-content\"><span class=\"ez-toc-section\" id=\"Spot_the_%E2%80%98inflation_hedge\"><\/span>Spot the &#8216;inflation hedge.&#8217;<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p>      <span class=\"wsj-article-credit article__inset__image__caption__credit\" itemprop=\"creator\"><br \/>\n            Source: CoinDesk, US Labor Department. MarketWatch analysis.<br \/>\n          <\/span><br \/>\n  <\/figcaption><\/figure>\n<\/div>\n<p>       I\u00a0have\u00a0a\u00a0surefire\u00a0way of using bitcoin<br \/>\n        BTCUSD,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/31322028\/realtime\" class=\"negative\">-3.18%<\/bg-quote><span>,<\/span><br \/>\n       ethereum<br \/>\n        ETHUSD,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/108573964\/realtime\" class=\"negative\">-4.06%<\/bg-quote><br \/>\n       and other digital currencies to finance your retirement\u2014but I can\u2019t recommend it.<\/p>\n<p> Go out and buy a bunch of bitcoin (or other digital currencies), get a receipt, and then im<a href=\"https:\/\/buradabiliyorum.com\/en\/category\/social-mediaa\/\" data-internallinksmanager029f6b8e52c=\"1\" title=\"Social Media\" target=\"_blank\" rel=\"noopener\">media<\/a>tely sell them. <em>Keep the receipt.<\/em><\/p>\n<div class=\"paywall\">\n       Then, when these currencies next collapse in price, as they are highly likely to do, go out and buy a bunch more. Immediately sell the ones you\u2019ve just bought, and <em>get another receipt.<\/em><\/p>\n<p>You will now have two receipts. One will show you bought a ton of bitcoin\u2014or whatever\u2014when the prices were up high, as they are right now. The other will show you sold the same amount of Bitcoins when it was much cheaper.<\/p>\n<p>So long as you are careful not to leave any documentary proof of the other two transactions, you can then claim these fictional \u201closses\u201d on your tax return. The IRS considers these digital currencies as <a rel=\"nofollow noopener noreferrer\" target=\"_blank\" href=\"https:\/\/www.irs.gov\/pub\/irs-drop\/n-14-21.pdf\" class=\"icon none\">property or investments<\/a>, and <a rel=\"nofollow noopener noreferrer\" target=\"_blank\" href=\"https:\/\/turbotax.intuit.com\/tax-tips\/tax-payments\/tax-tips-for-bitcoin-and-virtual-currency\/L1ZOgU00q#:~:text=Bitcoins%20held%20as%20capital%20assets%20are%20taxed%20as%20property&amp;text=Like%20stocks%20or%20bonds%2C%20any,or%20loss%20on%20an%20exchange\" class=\"icon none\">taxes them as such<\/a>.<\/p>\n<p>You can use these \u201closses\u201d to shelter any other (real) capital gains, and up to $3,000 a year of income, from tax. Savings? As much as you can claim.<\/p>\n<p>Sure, if you get caught, you\u2019ll probably go to jail for tax evasion. I\u2019m not recommending it. But I\u2019m passing the information on.<\/p>\n<p>(By the way, if the IRS audits you, I can only quote the Miami Herald\u2019s Dave Barry in similar circumstances. \u201cIf you follow my advice, and the IRS asks you where you got your information,\u201d <a rel=\"nofollow noopener noreferrer\" target=\"_blank\" href=\"https:\/\/www.miamiherald.com\/living\/liv-columns-blogs\/dave-barry\/article1939859\" class=\"icon none\">he told readers, <\/a>\u201cremember to give them my full name, George Will.\u201d)<\/p>\n<p>\u00a0OK, so technically this maneuver is illegal. But, hey, maybe you won\u2019t get caught.<\/p>\n<div id=\"cx-membership-tile\"><\/div>\n<p>And anyway, since when has \u201cwhat\u2019s legal\u201d mattered to investors in bitcoin or other digital currencies?<\/p>\n<p>The number one utility of cryptocurrencies is breaking the law. Digital currencies are fabulous vehicles for financing terrorism, drug deals, child pornography, murder for hire, money laundering, and pretty much anything else that is illegal but which you could in theory pay for online.\u00a0<\/p>\n<p>A study in the Review of Financial Studies found that <a rel=\"nofollow noopener noreferrer\" target=\"_blank\" href=\"https:\/\/papers.ssrn.com\/sol3\/papers.cfm?abstract_id=3102645\" class=\"icon none\">about half of all bitcoin transactions world-wide were associated with criminal\u00a0activitie<\/a>s. \u201cWe find that <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>roximately one-quarter of bitcoin users are involved in illegal activity,\u201d the researchers found. \u201cWe estimate that around $76 billion of illegal activity a year involves bitcoin (46% of bitcoin transactions), which is close to the scale of the U.S. and European markets for illegal drugs.\u201d <\/p>\n<p>For anyone who wants to take part in legal online transactions, there are much simpler mechanisms than buying cryptocurrencies and setting up \u201cvirtual wallets.\u201d You can just use\u2026er\u2026your debit card and bank account. And things like Google Pay and Apple Pay and PayPal<br \/>\n        PYPL,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/208054269\/composite\" class=\"negative\">-3.62%<\/bg-quote><span>.<\/span>\n      <\/p>\n<p>Yet digital currencies are now becoming so popular as investments that you can hold them in a variety of individual retirement accounts. I received yet another <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">news<\/a> release the other day about a company allowing us to hold cryptocurrencies in IRAs. <\/p>\n<p>Meanwhile hedge-fund manager Paul Tudor Jones\u2014<a rel=\"nofollow noopener noreferrer\" target=\"_blank\" href=\"https:\/\/www.youtube.com\/watch?v=jV3GVsECenw\" class=\"icon none\">not to be confused with Tenpole Tudor<\/a>\u2014was\u00a0promoting\u00a0bitcoin on CNBC recently as an \u201cinflation hedge\u201d and comparing it with the great <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/technology\/\" data-internallinksmanager029f6b8e52c=\"4\" title=\"Technology\" target=\"_blank\" rel=\"noopener\">technology<\/a> investments of the past.\u00a0<\/p>\n<p>\u201cIt\u2019s like investing with Steve Jobs and Apple, or investing in Google early,\u201d he said. His rationale? \u201cbitcoin has this enormous contingent of really smart, sophisticated people who believe in it,\u201d he said. \u201cYou\u2019ve got this group of people\u2026who are dedicated to seeing bitcoin succeed and becoming a commonplace store of value.\u201d<\/p>\n<p>He added, \u201cI\u2019ve never had an inflation hedge where you\u2019ve had a kicker where you\u2019ve also had great intellectual capital behind it, so that makes me even more constructive on it.\u201d<\/p>\n<p>It\u2019s not clear how much Tudor Jones had invested in bitcoin when he went on TV to talk it up. I\u2019ve reached out to his public relations team for clarification, but they declined to comment. Tudor Jones said during the interview he had a \u201csmall single digits\u201d\u2014or is it, \u201csmall, single digits\u201d?\u2013allocation to the cryptocurrency. A \u201csmall single digits\u201d allocation might be as little as 1%. On the other hand, a \u201csmall, single digits\u201d allocation could be pretty much anything below 10%.<\/p>\n<p>His firm, Tudor Investment Corporation, manages around $8 billion in assets,\u00a0so\u00a0that could potentially be anywhere up to nearly $800 million in the cryptocurrency.<\/p>\n<p>Tudor Jones\u2019 arguments about bitcoin are interesting. Some might reply that Apple<br \/>\n        AAPL,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/202934861\/composite\" class=\"negative\">-3.77%<\/bg-quote><br \/>\n       and Google<br \/>\n        GOOG,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/205453964\/composite\" class=\"negative\">-4.71%<\/bg-quote><br \/>\n       didn\u2019t succeed simply because they had a lot of smart people behind them, but because they provided great products and services that\u00a0consumers loved. Nokia<br \/>\n        NOK,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/207421390\/composite\" class=\"negative\">-4.76%<\/bg-quote><span>,<\/span><br \/>\n       BlackBerry<br \/>\n        BB,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/202784246\/composite\" class=\"negative\">-4.63%<\/bg-quote><span>,<\/span><br \/>\n       Yahoo and the like also had lots of smart people working for them, and it didn\u2019t save the stockholders.<\/p>\n<p>Actually, there were lots of really, really smart people working at Enron, too.<\/p>\n<p>It is a perennial argument of bitcoin champions that it must be a wonderful investment because the technology is so amazing. It reminds me of the old joke about the inventor who created a really clever device for scrambling eggs inside the shell. Yes, it\u2019s very clever, but why do I need it?<\/p>\n<p>Is bitcoin a credible \u201cinflation hedge\u201d? Sure, if you fear that the U.S. dollar is going to lose purchasing power, many things that aren\u2019t dollars will be \u201cinflation hedges.\u201d Ditto real estate<br \/>\n        DWRTF,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/210598039\/realtime\" class=\"negative\">-1.80%<\/bg-quote><span>,<\/span><br \/>\n       timberland, gold<br \/>\n        GOLD,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/201432642\/composite\" class=\"negative\">-4.31%<\/bg-quote><span>,<\/span><br \/>\n       art, wine, euros<br \/>\n        EURUSD,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/210561242\/realtime\/sampled\" class=\"negative\">-0.50%<\/bg-quote><span>,<\/span><br \/>\n       yen<br \/>\n        USDJPY,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/210561789\/realtime\/sampled\" class=\"negative\">-0.14%<\/bg-quote><span>,<\/span><br \/>\n       energy futures, and possibly luxuries like Rolex watches.<\/p>\n<p>But what inflation are we talking about? <\/p>\n<p>Gasoline, clothing and some other prices are falling. But in the past\u00a012\u00a0months, used car and truck prices have risen 10%. Food\u2019s up 4% and medical services 5%. Housing prices in the suburbs are up and apartment rents in the city are falling. Which ones do we want to hedge?<\/p>\n<p>The official overall consumer-price index has risen 1.4% in the past year. The bond market is predicting it will rise about 1.6% a year over the next five.<\/p>\n<p>Meanwhile, a look at the price for digital currencies shows the obvious issue. Take a look at our chart. It shows the price of bitcoin adjusted for the official consumer-price index. <\/p>\n<p>Even since bitcoin went mainstream, in 2017, there has been no correlation\u2014none\u2014with the CPI. The \u201creal,\u201d inflation-adjusted value fell nearly 80% at one point, and that\u2019s just looking at month-end prices and ignoring the even greater volatility when you count daily prices. (Actually there was no correlation before it went mainstream in 2017 either.) <\/p>\n<p>Hold bitcoin in an IRA and you won\u2019t have to pay capital-gains taxes on any profits, although you will have to pay ordinary income tax on the money you eventually withdraw from the account. But if you hold bitcoin in an IRA, whether a pretax \u201ctraditional\u201d IRA or a posttax \u201cRoth\u201d IRA, and you won\u2019t be able to claim any losses on your taxes either.<\/p>\n<p>The\u00a0best case\u00a0for holding digital currencies in an IRA is that you won\u2019t have to track and report every single transaction on your tax return every year. That alone is valuable. On the other hand, you don\u2019t have to own the digital currencies at all.<\/p><\/div>\n<\/div><\/div>\n<p><\/p>\n<div class=\"byline article__byline\">\n<p>      <span>By<\/span><\/p>\n<div class=\"author  hasMenu\" data-scrim='{\"type\":\"author\",\"header\":\"Brett Arends\",\"subhead\":\"The Wall Street Journal\",\"list\":[]}' itemscope itemprop=\"author\" itemtype=\"http:\/\/schema.org\/Person\">\n<h4 itemprop=\"name\"><span class=\"ez-toc-section\" id=\"Brett_Arends\"><\/span>Brett Arends<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/p><\/div>\n<\/div>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more News articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/news\/\" target=\"_blank\" rel=\"noopener noreferrer\">News category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"http:\/\/www.marketwatch.com\/news\/story.asp?guid=%7B21004575-02D4-D4B5-4572-DB9EE867C0C8%7D&#038;siteid=rss&#038;rss=1\" target=\"_blank\" rel=\"noopener noreferrer\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;# Opinion: Want to retire rich on bitcoin? &#8221; Digital currencies are so popular that you can hold them in a variety of retirement accounts Spot the &#8216;inflation hedge.&#8217; Source: CoinDesk, US Labor Department. MarketWatch analysis. I\u00a0have\u00a0a\u00a0surefire\u00a0way of using bitcoin BTCUSD, -3.18%, ethereum ETHUSD, -4.06% and other digital currencies to finance your retirement\u2014but I can\u2019t&#8230;<\/p>\n","protected":false},"author":1,"featured_media":99571,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"","fifu_image_alt":"","footnotes":""},"categories":[70897],"tags":[],"class_list":["post-99570","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/99570","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=99570"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/99570\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/99571"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=99570"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=99570"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=99570"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}