Cryptocurrency - help me understand please.

ihaveaquestion · Jun 18, 2024

blairandgretchen said: ↑

My good friend the chiropractor has sunk between 15-30k into this. The bulk has gone into 'DRIP' and some "Piggies" kinda deal. I struggle with the terminology and thought behind all this as I am relatively stupid and struggle with technology as it is.

So, to me - it's like I take a lump of firewood, and announce to the world that it is worth $1,000,000. Then I split it into a thousand pieces and sell it to anybody who believes that it is worth that. Maybe back it up with some slick marketing campaign and social media pumping to help out.

I've always struggled with the way world finances work. I understand the paper currency we have in our wallets depends on the majority having faith in it - that it is bartered and traded, exchanged, and represents the ability to buy, sell and exchange.

Same with other commodities - gold, or silver - you can't eat it, or lay it down at the local 7/11 to buy goods, but most agree it has value, based on the previous paragraph - faith.

I've always thought , at least since I was 30 - that if I know a farmer that raises cattle, and that I know how to raise a garden and can/preserve, can chop firewood, that I can survive. These to me are useful relationships and skills. I can drive for the farmer, wrench on his truck, process wood for warmth, and survive at least cold winters. And eat.

I am struggling with CryptoCurrency.

So - Confirmation Bias (thanks @double yellow) for hipping me to the term - tells a lot. If you're heavily invested in it with thoughts that it'll be a no-brainer winner - then you won't be able to rationally explain it to me.

This isn't a fight - I hope anyone invested in it is a sure fire millionaire , but to me, from the limited research I've done, it falls under the same red flags as Ponzi schemes, and Pyramid schemes.

My friend has more than enough to lose 30k - and I commend him for his bold investment, but lately he comes across as a maniac with all the terminology and speak about faucets and drips and piggies and farms. And I wonder if I'm the idiot.

All comments well appreciated .
Click to expand...

Crypto is a digital asset property, whatever the exchange amount, crypto holders pay taxes on movements twice;

First, mining of or sale of, crypto

second, sale of or gains from, crypto

Crypto owners “tax state found on their drivers license” matters in terms of taxes.

Day one crypto-owner mines/sold one coin at $50k.

Taxes on owners ordinary income

Day two crypto-owner later sells the coin for $52k. $2k capital gains.

Taxes on income of capital gains

Crypto-owner gains $50k of ordinary income & $2,000 of capital gains.

Factor tax state rates, configure taxes.

If you pay their cryptocurrency tax taxes incorrectly, jail for up to 5 years or six figure fines or both depending on judge/jury discretion and serious of matter

If you purchase crypto asset(s), you will not have a taxable event directly from that capital asset purchase until the asset is sold, or exchanged for another asset, or used to purchase a good or service. However, if you receive crypto from activities such as mining, staking, or lending, it is considered a taxable event for which you will pay the ordinary income tax rate.

AHayes90 · Jul 11, 2024

blairandgretchen said: ↑

My good friend the chiropractor has sunk between 15-30k into this. The bulk has gone into 'DRIP' and some "Piggies" kinda deal. I struggle with the terminology and thought behind all this as I am relatively stupid and struggle with technology as it is.

So, to me - it's like I take a lump of firewood, and announce to the world that it is worth $1,000,000. Then I split it into a thousand pieces and sell it to anybody who believes that it is worth that. Maybe back it up with some slick marketing campaign and social media pumping to help out.

I've always struggled with the way world finances work. I understand the paper currency we have in our wallets depends on the majority having faith in it - that it is bartered and traded, exchanged, and represents the ability to buy, sell and exchange.

Same with other commodities - gold, or silver - you can't eat it, or lay it down at the local 7/11 to buy goods, but most agree it has value, based on the previous paragraph - faith.

I've always thought , at least since I was 30 - that if I know a farmer that raises cattle, and that I know how to raise a garden and can/preserve, can chop firewood, that I can survive. These to me are useful relationships and skills. I can drive for the farmer, wrench on his truck, process wood for warmth, and survive at least cold winters. And eat.

I am struggling with CryptoCurrency.

So - Confirmation Bias (thanks @double yellow) for hipping me to the term - tells a lot. If you're heavily invested in it with thoughts that it'll be a no-brainer winner - then you won't be able to rationally explain it to me.

This isn't a fight - I hope anyone invested in it is a sure fire millionaire , but to me, from the limited research I've done, it falls under the same red flags as Ponzi schemes, and Pyramid schemes.

My friend has more than enough to lose 30k - and I commend him for his bold investment, but lately he comes across as a maniac with all the terminology and speak about faucets and drips and piggies and farms. And I wonder if I'm the idiot.

All comments well appreciated .
Click to expand...

Read Hudson Lee's Crypto for Beginners and stay away from "Opinion Pieces" or "Emotional, Knee Jerk, Responses". Also ask yourself how much you truly understand about the financial market and what drives it. If you don't understand the foundational pieces of Finance, especially world finance. Crypto is the enemy to uninformed minds that don't have a foundational understanding of the system itself. Kevin Peterson wrote Financial Intelligence the Beginners Guide to Understanding the Numbers. This book doesn't rely on the hype of podcast, opinion pieces, and finely crafted narratives that drive the populous. He relies on historical data and processes that have governed banking for hundreds of years. Crypto is "fashionable and cool" and the pretenders like to say they get it and that they've always "gotten it". That's a lie. Most people getting rich off of Crypto got in at the start or made their millions elsewhere. Do the work to understand it foundationally before moving on.

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Cryptocurrency - help me understand please.

ihaveaquestion Medium Load Member

AHayes90 Bobtail Member

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Cryptocurrency - help me understand please.

ihaveaquestion Medium Load Member

AHayes90 Bobtail Member

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