Bitcoin price hits a new high! The split controversy this time may not be much of a perceived risk?
Hello everyone, the best value! I’m completely failing to ride this wave@xi10jun1properly.
The timing really doesn’t seem to cooperate… I can’t look at the screen when it’s rising.
I’ve withdrawn 50,000 yen of assets this month, so with the remaining 50,000 yen I’m aiming to recover again, but it looks like it’s still a long way off.
※Continuing from the last issue, there is an important notice for readers who pay for this; please read all the way down if you can.
※This column is designed so that half of it is free to read, as a conscience-filled approach. Of course, if you read up to the paid portion (updated weekly, 400 yen per month, so about 80–100 yen per article), it would be very encouraging!
This week’s results (October 6, 2017 to October 12, 2017)
First, as always, here are the results. I’ll post the changes first.
- Last week (up to October 5, 2017) assets: 50,826 yen
- This week (up to October 5, 2017) assets: 50,458 yen
- Change: -368 yen
I did a few trades, but many of them were stop-loss at selling, so I ended up in negative territory this week.
It’s painful not to be riding this Bitcoin price surge… Couldn’t it rise right when I’m looking at the screen?
Now, this week’s column will discuss this rise.
No risk in the split-talk?
From the Bitcoin community news, there doesn’t seem to be much risk perceived for the planned split in November. Rather, people seem to welcome it, as assets automatically increase with the extra coins from the split.
In the last July split, Bitcoin dropped a lot, but even as October began this time, there isn’t noticeable downturn attributed to it.
If this continues, one might expect Bitcoin’s price to rise with each split. However, it’s also possible that assets get spread across the split coins, or that the split coins become more useful than the original, which could reduce Bitcoin’s value.
That said, even if that happened, it’s still a distant future.
Could the Chinese government overturn the ban on cryptocurrency trading?
This rise is attributed to speculation and expectations that the Chinese government might overturn the ban on cryptocurrency trading as indicated in the headline.
The September drop was due to China’s ICO and crypto regulations, but there is a possibility that those could be reversed.
Indeed, with that population, loosening regulations would likely increase trading volume.
It’s still just rumors at the moment, so we should proceed cautiously until there is solid reporting. Usually during these times, someone in China might say “there is no such fact,” and we could see another big drop.
Free section summary: back to a China-led market?
There have been previous periods when trading volume in China increased and prices rose.
Likewise, this time too the price may rise. However, as I’ve written before, one of the risks of BTCFX is “unpredictable statements by officials,” which should be kept in mind.
We must avoid depleting assets due to sudden volatility…
So this paid column will discuss future prospects.
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End note 1: Latest tax information!
The National Tax Agency’s site has updated the latest legal opinions regarding Bitcoin.
Here it is →No.1524 Tax considerations when profits arise from using Bitcoin｜Income Tax｜National Tax Agency
According to this, profits gained from using Bitcoin are treated as “miscellaneous income.”
So, for me, profits from margin trading are generally miscellaneous income. As I’ve been noting in this column, you cannot offset gains and losses here, as described in my blog post (→Settling Bitcoin margin trading (BTCFX) for tax filing! Comprehensive taxation of miscellaneous income? Separate taxation? | Investor Jun). It appears you cannot deduct losses against other income. I wish this could be handled differently…
Also, according to NewsPicks comments by Bitcoin’s CEO Yoshizo Kano (No.1524 Tax considerations when profits arise from using Bitcoin - NewsPicks), if you bought Bitcoin for 100,000 yen and bought something for 500,000 yen using it, the 400,000 yen difference is recognized as profit.
When you spend Bitcoin on goods or services, if the price of Bitcoin at the time of payment exceeds the purchase price, that excess is recognized as profit. So the same applies when shopping with Bitcoin on FANCY, so please be careful.
※Please note that laws and tax interpretations may change, which could alter how you file taxes or pay taxes. Before filing, be sure to check with your local tax office or a tax professional.
End note 2: Let’s try shopping with Bitcoin!
Interestingly, the overseas e-commerce site “FANCY” lets you buy goods with Bitcoin! It may incur shipping, but it offers stylish items not seen in Japan.
Instructions for using FANCY are summarized on this blog, so please refer to it.
- →FANCY account creation, registration, and purchase flow explained! | Investor Jun
- →How to buy (pay with) items on FANCY with Bitcoin | Investor Jun
※Free content ends here. The rest is detailed analysis and future prospects, so it is paid. If you want to read more, or if you’d like to support me with a tip, I would greatly appreciate your subscription. Thank you for your continued support!
