Say BTC/LTC/Eth is at all time high and you want to trade them but keep funds in the crypto space for buying back in the dip. Correct me if I’m wrong, but I understand that trading BTC/LTC/Eth for fiat will get reported to IRS as gains and hence taxable…trading back and forth this way is going to cost more in tax than profits. The only other option I know of is to trade into USD tether, but how stable/safe is that? Any other options? Thanks!
This is exactly why people are being so nervous when trading Bitcoin against fiat.
USDT is a risk depending on how long do you plan to keep your investment in it. If it’s about a few days, I’d assume that risk. Even if Tehter is so shady that can really crash overnight, haha.
If you’re planning to sell at the top and wait for it to sink, go back in fiat and pay your taxes.
You shouldn’t keep any of them (btc or fiat) on the exchange. Always withdraw.
The third option, finding a stable alt, I see it as gambling. I won’t trade ALL my Bitcoin for Dash, Litecoin, or idk, even for a short period of time.
Thanks for your reply! Speaking of taxes, what do people use to track trades? I have Blockfolio on my phone but I only use it for price alerts, I read that it calls home alot. I see other options online too, but not sure which to use. Any recommendations?