I had invested about $5k worth of crypto in May 2021 when it was almost at its peak - I have been holding for long enough and things have been going south lately. Investments are spread across multiple coins and they are nowhere near where I bought them (yes, all of them).
I have lost about 85% of my initial investment and I think I should just register my losses and get out - I've also heard there might be "some" tax benefits.
If you were in my shoe, what would you do ?
Ah yes, the irony of a crypto investor.
Took their investment advice from the great internet Ponzi marketers, makes sense they would take further advice from internet randoms about crystallising their losses…
.#Bitcoin will test $13,000 by the end of 2022.
Sell now or not. Your choice.
Like I said, its not just bitcoin, I atleast put my eggs in different baskets - all baskets unfortunately downsized
You bought #Bitcoin for around $60,000.
What made you buy $BTC at that price?
What has changed in your thesis about #Bitcoin other than the price going from $60,000 to $20,000?
Might be harsh on myself and say #FOMO
All crypto-gurus saying it will breach $100K - #LOL ?
@Tldr: guru's haha…
If you were at the casino and someone said the next 5 cards will be black - would you put $60k on it?
@Tldr: Unfortunately it's easy to buy into the hype/fomo and get suckered in trying to make money out of greed.
Let alone if you actually buy into the idea of crypto for whatever reason and get suckered in that way. There still really is no sound use case for it.
If you wouldn't buy at the current price, you should sell it what you hold at the current price. Regardless of what you have already lost. When you've lost most of your life savings at a casino you should walk away with what you have left. Not selling and buying more are the exact same difference.
Nice perspective, thanks for that!
Depends on your situation, if you have significant capital gains to report, having losses to offset might be a good option. Whether crypto is a good investment is an entirely a different question…
Another question to ask yourself is whether you enjoyed the crypto investing itself other than making money etc (which is definitely the main objective). For me, learnt quite a bit about web 3.0 and other stuff I wouldn't learn if not for crypto trading. I lost a fair amount in the recent crash too but as long as it is only your 1 % (me below 5%) of your total investment portfolio, just hold for fun! (And rewards maybe)
LOL I tell myself similar things when I fail math exams.
Failed math exam….hmm…make sense of your comments then….
If I were in your shoe? I'd sell and buy a second shoe.
Congrats on your purchase of your first ponzi scheme.
Sell that garbage, i reckon Crypto will be dead in 10 years.
Someone else in Bora Bora now is spending it on hot girls that basically sold their crypto to you…
You will wait long time to reach it highs it had in May 2021.
85% loss means over 500% just to get back to being even. Do you think your coin/s will go up five fold from here on out?
.#DCA to bring the entry price closer to the current price.
I dont think so, I've now decided to HODL
Keep in mind, if you swap from one crypto currency to another, that is a cgt event that needs to be reported on your tax return. Even if you don't withdraw the cash, it is still the sale of one asset and the purchase of another.
People who trade and swap currencies daily throughout the year will have a cgt nightmare come tax time. And the ATO is data matching with the various exchanges.
Crystallise the loss. Get back in when it's lowers that's what I am doing. FYI lost roughly 50% value since late last year.
I should have had a stop loss at 10%, ppl told me it would rebound - it never did
And it never will.
Best of luck
Today could be the day. #Bitcoin looks weak and good for sub $18,000 in the next 24H.
He meant in USD. not 18k but close 19k.
"write it off" mentally but do not sell.
see what happens in 5-10yrs
its the only reason I still have BTC from 2014-2015ish
[ ] OP understands CG Tax
Are you intending to sell and then re buy to realise the loss? Bear in mind there are specific tax anti avoidance rules for this. It's called wash sales. Refer TR 2008/1
85%??? yikes - just hold for forever now!!
If you were in my shoe, what would you do ?
I would come up with an investing strategy. The worst thing is to buy a risky asset when it is booming and then just keep sitting on it. Either keep buying regularly or change to a different asset that you believe more.
Too late for it now, but you could have considered wrapping / unwrapping your coins to a different network. The excuse for it not to be considered a wash trade can be that you DYORed that the other network/chain seemed better but then you didn't make a move because of market conditions.
OP can still sell now for a loss and claim 2022/23.
It infuriates me that people can take money away from the public through tax incentives for making a stupid decision on an investment. Crypto, stocks or anything else.
Policy Should be scrapped.
Except, it's not really tax incentive. If you get taxed when you make capital gains, it's only fair that you get to write off your capital loss.
The feds can try to change it.
People will stop investing in Australia.
really annoys me that the public get a slice of my gains…. whats the diff
what really annoys me is if you make a loss first and no gains, you can't write it off,
but make a gain first, and no loss and oh yes bend over and we will have some of that. rules not equivelant for both parties
Not really the case with cyrpto or stocks.
Like in OP's case.
The ATO gets the same coin wether he made his 85% loss foray into crypto or not.
What infuriates me is you thinking you are entitled to other peoples money in the first place!!
Buy low, sell high dummy
Hold Onto Dick Love
Keep until the p2pk Satoshi key (and other early private keys) are cracked within a few years. RIP Bitcoin (will be delisted). Other coins may survive but take a hit.
People who worry about QC are like worrying about pigs with wings 💩 on their heads.
https://www.youtube.com/watch?v=wlzJyp3Qm7s
LOL moondude literally speculates the keys could be broken but he "doesn't think they would use it to break Bitcoin".
"Quantum computers are posing a serious challenge to the security of the Bitcoin blockchain. Presently, about 25% of the Bitcoins in circulation are vulnerable to a quantum attack."
"In a situation where a large number of Bitcoins is stolen, the price will most likely crash and the confidence in the technology will be lost."
Not saying don't invest in crypto, but people need to know the risks. Too many heavily invested individuals (and entities) deliberately understate the risks and investment window / cycles of crypto and alts, causing people to lose a lot of real money - sometimes when they can't afford it.
They will just fork the network.
Might as well use Bitcoin Cash because it won't be BTC.
Thanks everyone for your valuable comments. I've decided to HODL. I've also decided not to lower down my average buy price by investing more. Hopefully I can get out of this if crypto goes up.
Thanks once again!
Buy at peak and sell at the bottom? Why lol. You have no reason to sell it, you'll be locking in your losses and you hand no gains to offset so I hope you held
You could sell, register your loses and then rebuy next FY. almost a wash trade. However that is only if you have a long term intention to hold and the benefit is only if you have other capital gains to offset now or likely in the near future (the losses rollover on your tax so you can offset future years gains).