Bitcoin has split in two, so you can have double the cryptocurrency

Menu IconA vertical stack of three evenly spaced horizontal lines. Bitcoin bitcoin has split in two, so you can have double the cryptocurrency likely split into two separate currencies on Tuesday, and it’s all thanks to bitcoin cash. On one side of this war, there are the so-called core developers who want to keep the blocks that make up the network limited in their size to protect against hacks.

On the other side, are the miners who want to increase the size of blocks to make the network faster. As a result, a split in bitcoin on August 1 at 8:20 AM EST, the deadline for Segwit2x implementation, appears to be very likely. According to Morris, as soon as the split takes place most people will see their bitcoin holdings double. But that doesn’t mean the value of investors’ holdings will double.

Thus, if a split were to occur BCC would trade somewhere in that range while the value of bitcoin would witness a decline equal to the value of the new bitcoin. Bitcoin’s rival, Ethereum, experienced its own fork in 2016, eventually leading to the creation of the version of the cryptocurrency we know today. It will be similar to what happened with Ethereum when Ethereum classic came on the scene,” Morris said. The two currencies marketcap equaled out to the market of the original Ethereum.

On the whole, most bitcoin enthusiasts aren’t too concerned about a fork. In general, I think the fork is a healthy process because it’s similar to how evolution works in nature,” Yoni Ben Shimon, cofounder and CEO at Matchpool, told Business Insider in an email. And that is the main reason bitcoin will never die – it’s because it can adapt itself to changes. There are people with billions of dollars of skin in the game and they will ultimately go with the superior bitcoin network, and then the market will follow,” Hayes concluded.

Get the latest Bitcoin price here. You have successfully emailed the post. Cryptocurrency exchange Gemini is making the addition of more coins to its exchange a focus in 2018, according to a Bloomberg News report out Thursday. Kraken also plans to add to the number of coins trading on its platform as part of a broader expansion, according to a person familiar with the company’s operations. Gemini and Kraken, two of the largest cryptocurrency exchanges in the US, are looking to add to the number of coins listed on their respective platforms. Cameron and Tyler Winklevoss, the founders of crypto exchange Gemini, told Bloomberg News on Thursday that the company plans to make the addition of more digital currencies a focus in 2018. The most likely additions, according to Tyler Winklevoss “are from the Satoshi Nakamoto family tree: Bitcoin cash, Litecoin.

Gemini, a New York-based firm, facilitates 1. The exchange serves as the basis for Cboe Global Markets’ bitcoin futures market. 434 million in trading volume per day, is also looking to hire 800 people in 2018, Business Insider previously reported. Kraken supports trading for bitcoin, ethereum, XRP, and a number of other alternative cryptocurrencies. Adding coins can sometimes be viewed as a political move within the cryptocurrency community, because it can be interpreted as a stamp of approval by the exchange of a given crypto. When Coinbase added bitcoin cash trading to its platform it faced backlash from so-called bitcoin maximalists, who disagree with the technological and ideological foundation of bitcoin cash, which split from the main bitcoin in August.

A Scalding Issue

A spokeswoman for Coinbase told Business Insider the addition of more coins is not a priority at the moment. More coins will likely translate into more trading volumes, which means more money for the exchanges. Already, they are making money hand over fist. 3 million from trading fees per day. But regulatory uncertainty still hangs over the heads of crypto exchanges. If a platform offers trading of digital assets that are securities and operates as an “exchange,” as defined by the federal securities laws, then the platform must register with the SEC as a national securities exchange,” the agency said.

Bitcoin has split in two, so you can have double the cryptocurrency

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If the regulator were to immediately declare that markets such as Gemini, GDAX, Kraken, Bittrex, and others operating in the US, had to immediately cease and desist trading of crypto assets, that would cause panic and investor losses,  he said. The day I first heard about Bitcoin on Reddit, a friend had also called me to tell me about it. We spent most of our friendship talking about Ayn Rand and programming, so when we heard about a currency that was software and couldn’t be controlled by governments we were very interested. 600 worth of BTC and my friend and I planned on buying a mining rig. Being 22 years old in New York City is a financial struggle. I sold it all and ditched my plans for a mining rig.

Bitcoin has split in two, so you can have double the cryptocurrency

My financial situation needed to be stabilized before I could invest in assets based on my philosophical beliefs. Bitcoin stayed in the news over the years. The price went up and down, silk road happened, the legality of it was called into question, exchanges were hacked, and people gained and lost millions of dollars. Through it all, Bitcoin’s price kept rebounding, kept going up. Ethereum hit the scene with the promise of using the blockchain for more than just currencies. You could build decentralized apps on top of Ethereum and even new currencies.

Unlike in 2011, I didn’t need the money I invested to cover any bills. In the same period I shut down my company, Bitfountain, after running it for 5 years. Bootstrapping my own company gave me an unprecedented amount of freedom. I lived in 4 countries, traveled to many more, and only worked a few hours per day. However, since the company had run its course, I needed a new source of income. I applied for only one job as a software engineer.

Absolutely it is.

It was the kind of job people love – high salary, all the Silicon Valley benefits, friendly team, well funded company, challenging engineering problems. After three rounds of interview they decided not to move forward with me. I’m not going to lie and say I didn’t want the job anyway. But I also feared losing my freedom.

Bitcoin has split in two, so you can have double the cryptocurrency

the Lightning Network is resolving the scaling challenge for Bitcoin and other blockchain cryptocurrencies

I’d be working more for less money and less flexibility than I had while running Bitfountain. Gone would be the days where I could spontaneously book a flight to India with no return date. No more of the four hour lunch breaks that I’ve come to cherish over the years. Going through the interview process made the possibility of losing my freedom real. When they rejected me I didn’t even think about applying for another job. I went into panic mode searching for a way I could make money on my own. Check out this presentation I gave on why I trade.

Bitcoin has split in two, so you can have double the cryptocurrency

My first month as a cryptocurrency trader At this point I still owned Ethereum and the price was still swinging back and forth. Since I needed an income and didn’t want to get a job, it was time to try this trading idea. But I set a strict requirement that if I didn’t earn enough money to pay my rent after a month, I’d quit trading. It’s fourteen months later and I’m still trading. I signed up for two exchanges: GDAX and Poloniex. GDAX made sense because it is run by Coinbase, the company where I purchased and held Ethereum. Those are the first two exchanges that I used.

Now I use others since each exchange has pros and cons. I wrote about the best cryptocurrency exchanges if you’re interested in getting an overview of the possibilities. A live crypto exchange is intimidating at first glance. There are charts and numbers changing at the speed of sight.

I felt overwhelmed but sat through the confusion to try and make sense of what I was looking at. Soon I could see where to place orders to buy and sell, and the charts started to make sense too. 100 investment in my first 45 minutes of trading. As the month went on I spent hours trading.

I’d buy when the price looked like it was going up, and sell when it looked like it was going down. I didn’t use any technical indicators and I didn’t have a strategy. I made enough to pay my rent, so the possibility of making a living from this was validated. Although I profited, I wasn’t sure if I just had a lucky month.

I wanted to formalize my trading knowledge so I could do more than buy low and sell high. There had to be a real strategy to this stuff. I read as many books as I could on trading stocks and foreign exchange markets. I made a lot of mistakes. But eventually I found my rhythm and strategies.

Earning Bitcoin while my rent is paid in US Dollars This isn’t an introduction on how to trade cryptocurrency, but I need to give you some background on it before continuing on the topic of making a living day trading cryptocurrencies. For myself, and most crypto traders, the goal is to increase the amount of Bitcoin we own. I don’t care about the US dollar, at least not directly. When I look at the price of a cryptocurrency, I look at it in terms of BTC. The goal is to get more BTC. Another thing I need to make clear is the type of trading I do – day trading.

Alpha Phi Omega

My base currency is Bitcoin, which I use to buy Altcoins like Ethereum, ZCash, Golem, etc. When I make a trade to buy an Altcoin with BTC, I could end up selling the Altcoin back for BTC within a matter of minutes or hours. All of my profits are converted back into BTC at the end of each trading day. Again, even though I buy and sell several Altcoins, at the end of the day my net worth is in Bitcoin. They don’t allow you to trade with USD or another fiat. I’m simultaneously investing in Bitcoin by holding my day trading profit in BTC.

Bitcoin has split in two, so you can have double the cryptocurrency

I earn more USD when the price of Bitcoin goes up against the dollar. I believe in Bitcoin as a store of value. Why was it important to clear this up? Because I’m earning Bitcoin but my rent is paid in USD!

I need to sell BTC for USD to pay my bills. Several things were on my mind the first time I had to do this. What if I sell my BTC now and the price shoots up tomorrow? Won’t I be missing out on profit? Yes, but your bills will be paid.

If I don’t sell now and the price of BTC drops, I won’t be able to pay my rent. Sell now so you can pay your rent. This is a conundrum that you’ll need to deal with as an investor or day trader. You can always hold out for more, but at the same time you are risking a loss. If you have bills, just sell the Bitcoin for fiat and don’t look back. When do I sell Bitcoin for a Tesla Model X After a few months I got better at trading.

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I was earning more Bitcoin than I needed to cover my monthly expenses. At the end of the month I sold only what I needed, and kept the rest of my net worth in Bitcoin. Around this time in my trading career it was getting to the point where I could have bought a Tesla or put a down payment on a house by selling my Bitcoin. Let’s say the price of Bitcoin has reached an all time high, as it has done so many times in 2017. Do you sell your Bitcoin to realize your profit in USD?

I am faced with that decision every day now. Taking the USD I’ve made to buy a home is a solid decision. I can live a nice middle class lifestyle in Los Angeles. Or I can drive a flashy car while I rent a crappy apartment in Los Angeles.

It all comes down to your values. But that’s not the route I am taking. Those aren’t the patterns I am looking for when I trade. The wild bull runs are hard to find, hard to time properly, and easy to go in the opposite direction where you lose a lot. Those gains are only exciting if you understand how far they can get you. I’ll make much more money in the long term. Of course the numbers above assume you trade 365 days per year.

Not many people are willing to forego vacation and weekends to work as a full time crypto trader, even with numbers like that. It makes a whole lot more sense if you are only working 90 minutes per day. At this point I am actively trading for only 1 to 2 hours every day. Not only that but I also let my emotions control my trades. For example, I once purchased Stratis after the price dropped massively. My assumption was that on such a sharp decrease in price, it had to rebound eventually.

Now I have my strategy that I stick to without letting my emotions interfere. I have a set of coins that I like trading so I only look at those charts. I have patterns and indicators that I look for on those charts so I can quickly flip through them. Within minutes I can set my orders, set alerts on my desired entry and exit prices, and walk away from the computer. You might be trading on an exchange that doesn’t report to the IRS or you might want to take advantage of the lack of regulation in the space. As the market cap of crypto increases, be sure that the IRS is going to find out how to get their slice.

And they will look into the past. I am not a tax advisor. This is a simple overview of what I keep in mind as I trade. My accountant handles my taxes, and I advise you to get an accountant to do the same. Keep in mind that this is US-centric.

You need to double check if this is the case in your country. The taxable event is when you sell your cryptocurrency for fiat. In my case, it is when I sell BTC for USD. How much tax you pay depends on how long you were holding the cryptocurrency. Crypto that you hold for less than a year Let’s split this into 3 transaction types.

Buy crypto with fiat – no tax. When I buy Bitcoin or another Altcoin with USD, I do not pay tax on that transaction. Sell crypto for fiat – pay ordinary income tax. Buy crypto with crypto – unclear, but does not seem to be a taxable event.

This is where things get foggy. Consult your advisor, but as far as I know this is a like-kind exchange which is not taxable but must be reported to the IRS. The exchange you use will output all of these transactions so you can hand them to your accountant. Update: The IRS has clarified that a crypto to crypto exchange is not a like-kind exchange.

The profit made from each transaction is taxed. Crypto that you hold for more than a year If you are holding a currency for more than a year it is classified as long term capital gains. This is another reason why I like keeping my net worth in Bitcoin. I decide to cash it out to USD. That’s a much lower rate than normal income tax. Other ways to make money with cryptocurrencies I’m not going to go too deep into other ways you can earn money with cryptocurrencies because I don’t do them myself.

After you make an initial investment, you mostly sit back and watch the money roll in. It’s like buying a home and renting it out – there will be some maintenance issues but it’s mostly passive income. Cryptocurrencies offer at least two routes for passive income. You invest in a very strong computer and the electricity to run it, and you are rewarded with crypto for contributing to the network as a node that confirms blockchain transactions. Proof of stake This is an alternative to mining that does not require vast amounts of electricity. The idea is that you stake the cryptocurrency that you own over a wifi connection.