15 votes

Federal court authorizes IRS John Doe summons seeking identities of US taxpayers who conducted at least $20,000 in cryptocurrency transactions during the years 2016 to 2020

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  1. [3]
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    While I can understand some of the perceived benefits of cryptocurrencies, I still have reservations about them based on traditional economic advice. One of these advises, is my CPA who holds a...

    While I can understand some of the perceived benefits of cryptocurrencies, I still have reservations about them based on traditional economic advice. One of these advises, is my CPA who holds a masters degree in finance.

    There are cautions and/or criticisms that have been, at least, documented through Wikipedia here.

    From what has been explained to me so far, these are not backed by anything of value. Henceforth, there is an enormous risk being taken that could result in huge losses compared to traditional investment opportunities such as a Roth IRA.

    1 vote
    1. stu2b50
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      To be pedantic, they're not really the same thing. An IRA (Roth or not) is a type of taxed advantaged account. It is usually invested in something, as growth is tax-free, but you can simply leave...

      compared to traditional investment opportunities such as a Roth IRA.

      To be pedantic, they're not really the same thing. An IRA (Roth or not) is a type of taxed advantaged account. It is usually invested in something, as growth is tax-free, but you can simply leave it in a checkings account as well, slowly dying to inflation. Or invest it in most things - but of your choosing (or, usually the company you opened it with has a few products and you choose).

      Most things, except financial derivatives, collectibles, personal real estate, and a few other things.

      Notably... that list does not include cryptocurrencies. That's right, you can seriously get Bitcoin IRAs (and presumably other cryptocurrencies). Very possible the IRS will update the exceptions to exclude cryptocurrencies in the future, but at the moment, you can invest your IRA funds into crypto.

      Not that that's a very good idea considering they're typically for retirement, but on the other hand there are a bunch of loopholes specifically with Roth IRAs that crypto speculators could abuse to great effect.

      5 votes
    2. skybrian
      Link Parent
      We probably should resist the urge to talk about cryptocurrency in general in every topic that's about cryptocurrency, or we're just going to be repeating the same conversation. But yes,...

      We probably should resist the urge to talk about cryptocurrency in general in every topic that's about cryptocurrency, or we're just going to be repeating the same conversation. But yes, theoretically you could lose everything you put in. You might compare with buying a lottery ticket or some kinds of stock options.

      Unlike a lottery ticket, though, nobody can say for sure that the odds are against you. So I think cryptocurrencies are weirder and more interesting than lottery tickets.

      5 votes