On August 23, Bitcoin.com released a new application called the SLP Dividend Calculator. The new platform allows users to build a transaction to make dividend payments to any Simple Ledger Protocol (SLP) token holder.
Testing the New SLP Dividend Calculator From Bitcoin.com
Over the last year, SLP tokens have been extremely popular among BCH proponents, and so far supporters have made thousands of unique coins on the BCH chain. As time has progressed, the SLP ecosystem has matured a great deal and there are many third-party solutions supporting the token infrastructure. This week, Bitcoin.com added a new platform to our Tools.Bitcoin.com portal called the SLP Dividend Calculator. The application provides users with the ability to make grouped dividend payments to specific SLP token holders. For instance, if you distributed fractions of an SLP token to a group of three people, then you could enter the token’s ID and send funds to all three holders at a specific point in time. With the ability to pay BCH dividend payments to SLP token holders, the new tool opens the door to all kinds of real-world use cases.
After the new tool was released, I decided to test the service in order to highlight just how easy it is to use the new Bitcoin.com SLP Dividend Calculator. I tested the app with my cousin, Andrew Brow, because back in June I sent him some custom SLP tokens called “Andy Coin (ABC)” just to show him how simple it is to create tokens. At the time I created 21 million ABC coins and sent 10 million to my cousin’s Badger wallet. Last night I opened up the SLP Dividend Calculator and pasted the token’s unique ID number into the first window.
Then I decided to pay $1 to the Andy Coin token holders, which means it will be split in half between both of us, because we are both ABC token holders. The SLP Dividend Calculator can pay a lot more than just two addresses, but for this test two was enough. After making sure the SLP token ID and the number of funds I wanted to send were correct, I decided to make the funds available at the last confirmed block height. You can also choose to broadcast it as is in the latest mempool state or you can choose a custom block height as well.
The service gives you two choices after the customization is complete: you can either press the button “Start over” or “Build the transaction.” After I chose to build the transaction, the application showed me exactly what would happen after I paid the unique payment invoice. The SLP balances were scanned at block height 597121 and I sent a dividend payment of 0.003176 BCH, which would be paid to the token holders of the Andy Coin token ID number. The platform also told me that two addresses would receive a BCH dividend payment after I paid the QR invoice code through Pay.Bitcoin.com. Any wallet that supports invoices, like the Bitcoin.com Wallet, can pay the invoice by copying the URI scheme or scanning the QR code. I used the Electron Cash wallet to pay the invoice, because I had some available funds in the wallet and I wanted to see exactly how the transaction was built and executed from the client perspective.
Opening the Door to a Decentralized Stock Market, Trust Payments and Bearer Bonds
After paying the invoice, the transaction broadcasted and my cousin Andrew and I were both sent $0.50 in BCH each. The transactions confirmed in the following block and the entire test can be seen on Bitcoin.com’s Block Explorer or Simpleledger.info as well. The tool could be used for a variety of interesting dividend payment ideas. For instance, Bitcoin.com’s executive chairman, Roger Ver, recently sent BCH dividend payments to Cashgames.Bitcoin.com Dividend Test Token (CGT) holders for being Cashgames.Bitcoin.com patrons.
A person with four children could create four separate non-fungible (NFT1) tokens with the kids’ names attached to them and call them Trust Tokens. After a specific block height, the Trust Tokens can be sent a BCH dividend payment in order to leave an inheritance to the children. Or a business could have people invest in the company by initiating an initial coin offering (ICO) and token holders could reap the profits in the form of dividend payments over time.
The sky’s the limit when it comes to the variety of concepts that can derive from people using the Bitcoin.com SLP Dividend Calculator. Since the application was launched, a bunch of BCH supporters have tested the platform to send funds to certain token holders. “Fantastic,” one BCH enthusiast wrote on the Reddit forum r/btc. “[This] gives us decentralized stock market… dead easy to use.”
“Holy crap the new SLP dividend tool is awesome. Just played around with it and sent all holders of the MIS token their share of .01 BCH just to test it out,” another BCH user said on Twitter. “This is magic internet money for reals.” If you have created SLP tokens you can try sending a dividend payment to token holders by using the SLP Dividend Calculator. The process takes less than two minutes to complete and you don’t need to be a tech wiz to use the new tool. Check out the platform at Tools.Bitcoin.com and send your first BCH dividend payment today.
Altcoins, not Bitcoin will harbour more value by 2020, claims Bitcoin.com’s Stefan Rust
Roger Ver aka Bitcoin Jesus was in the news recently after he left his position as CEO of Bitcoin.com and appointed Stefan Rust, who was formerly the Global Head of Corporate and Business Development at the company. Bitcoin.com has also witnessed an array of developments of late, starting from the launch of its native cryptocurrency exchange to its recent partnership with HTC to add BCH support on HTC’s blockchain smartphone.
Newly-appointed CEO Stefan Rust addressed this partnership in a recent Ask Me Anything [AMA] session. Rust asserted that the collaboration has given the opportunity of having a bank on the HTC Exodus 1 smartphone. The blockchain smartphone will be pre-equipped with a wallet application and will be the first smartphone to support BCH. Rust added that the HTC partnership would stimulate the growth of BCH as a payment medium.
Several crypto-analysts have been vouching for a surge in the price of Bitcoin towards the end of this year. However, Rust believes that by 2020, there would be an increase in the adoption of other cryptocurrencies. He also asserted that more value would emerge from altcoins and not Bitcoin. He said,
“The main reason is if you are transacting building commercial services on chain, you are actually driving more value for the chain and ultimately building utility for that service, which people want to transact around in a trustless, borderless environment.”
Rust further highlighted the fact that altcoins are particularly attractive as they can be used across several fields.
Bitcoin.com’s David Shin had a while back said that the company is focusing on accelerating the market cap of BCH, while also revealing that the company is planning to launch a futures contract for the coin. Rust reiterated the same in his AMA, stating that the goals of the company revolve around pushing BCH into the top three of the world’s largest cryptocurrencies by market cap by next year.
Further, Rust spoke about the potential ban on cryptocurrencies by the United States. According to Rust, the United States would be at a “detriment,” if it banned crypto. He went on to highlight how innovation is paving the way to the creation of jobs, which is one of the most important necessities of any economy.
7 Hacks to Minimise Your Crypto Tax Liability
Have you had a great year with cryptocurrencies? Made the right trades at the right time and seen some hefty gains? Unfortunately, come tax season and the IRS is going to want a big chunk of your gains – they are already sending out warning letters!
Given that crypto trading hasn’t been around for too long, there isn’t a lot of clarity around crypto taxes and how they work. Yet, there are a few things that you can do today to minimize your tax liability in a big way. Here are some of the most important ones:
#1 Cut your losses before the year ends – or not
Let’s say you have made significant capital gains selling cryptocurrencies during the year. But you’re currently holding currencies whose value is extremely low. Selling these holdings will trigger a capital loss, and you can use those losses to offset other capital gains and even up to $3000 of ordinary income. You can also carry over remaining losses to the next year.
But what if you don’t actually want to sell your holdings but stay invested for the long term? A simple approach is to just buy back what you’ve sold after a few days. Luckily, cryptocurrencies are classified as “property” by the IRS, which means that the “Wash Sale Rule” that applies to stocks and securities doesn’t apply to cryptocurrency. The Wash Sale Rule prevents traders from offsetting capital gains if they repurchase an investment that was sold for a loss in the last 30 days. Since this doesn’t apply to cryptocurrencies, you can sell your holdings, book your losses, and then buy them back.
#2 Remember your trading fees, they pile up!
This one’s a no-brainer but still gets forgotten sometimes. Cryptocurrency trading fees are nothing but a cost to acquire the crypto, and are therefore treated as a fully tax-deductible. Transfer fees, on the other hand, are not directly related to the cost of acquiring the crypto. So ignore the transfer fees (which are relatively negligible anyway) but deduct all trading fees.
#3 Be a HODLer for at least a year
Holding cryptocurrencies for less than a year triggers short-term capital gains tax which end up being significantly higher than long-term capital gains tax. So it’s usually better to stay invested for a longer period of time.
Of course, you may argue that the volatile nature of cryptocurrencies means that gains are mostly realized over very short periods. A good way around this problem is to use instant crypto credit lines. These allow you to borrow against your crypto assets instead of having to sell them. So you get instant access to cash while staying invested in the long run and avoiding crypto taxes. The only thing to keep in mind is that such credit lines come with interest rates which are much lower than the tax rates but can pile up if you are borrowing long term – something to keep in mind.
#4 Buy crypto using your IRA or 401-K
If you use a retirement account to buy cryptocurrencies, all the capital gains generated from the transaction will come back to the account with tax deferred. In fact, in the case of a Roth IRA, there’ll be no tax liability at all. So you can keep investing in cryptocurrencies over a long period of time, without having to take out money to pay capital gains tax.
#5 Made gains in real estate and lost big on crypto? You are in luck.
It’s important to remember that your crypto capital gains can also be offset against other capital losses. So if you’ve had a bad run at the stock markets (which isn’t improbable, given that the MSCI world index actually went down 10.44% last year), you can use those losses to offset some of your capital gains and reduce your overall tax burden.
#6 Make the world a better place – give to charity!
If there’s some serious money at stake, Charitable Remainder Trusts (CRTs) are a tax planning vehicle that you can use to minimise your tax liability in a big way.
You need to create a CRT and then transfer your cryptocurrencies to the trust. The trustee will then sell the cryptocurrencies at full market value and then reinvest the proceeds from the sale into other income-generating assets. Not only do you not have to pay any capital gains when the asset is sold, but you will also receive a charitable deduction when you transfer the property to the trust. The trust pays you an annuity for the rest of your days, after which the remaining assets go to charity. So you reduce your tax liability and convert your cryptocurrencies into an income-generating asset!
#7 Record everything!
Failure to report crypto transactions can result in a penalty up to $250,000. Given that there are so many transactions taking place in the course of the year, calculating the amount of tax you owe can become complicated. That’s why it’s important to keep all your transactions in an excel file so that you can calculate the cost of purchase easily. If you don’t have perfect record-keeping, it might be a good idea to use crypto tax software that can help you consolidate the data and generate the documents you need.
The bottom line
Take proactive measures to minimize your crypto tax liability. Use these tips early in the financial year so that you can prepare yourself for tax season and keep most of your capital gains. If you are not sure how to prepare your tax returns, hire a competent crypto tax accountant. While this option may be expensive a good accountant can usually make up for the fees by saving you on taxes.
Bitcoin Price (BTC) At Clear Risk of Further Declines
- Bitcoin price failed to hold the key $10,300 and $10,250 support levels against the US Dollar.
- The price is currently trading with a bearish bias and recently tested the $10,000 support area.
- There is a key bearish trend line forming with resistance near $10,340 on the hourly chart of the BTC/USD pair (data feed from Kraken).
- The price is likely to revisit the $10,000 support level as long as it is below $10,400.
Bitcoin price is trading with an increased bearish bias against the US Dollar. BTC might accelerate its decline below $10,200 in the coming sessions.
Bitcoin Price Analysis
Yesterday, we discussed the importance of the $10,250 support for bitcoin against the US Dollar. The pair remained in a negative zone below the $10,400 resistance level and the 100 hourly simple moving average. As a result, there was a bearish reaction below the key $10,300 and $10,250 support levels. During the decline, there was a break below yesterday’s highlighted breakout pattern with support near $10,320 on the hourly chart of BTC/USD.
The decline gained pace below the $10,200 level. Moreover, the price spiked below $10,150 and tested the $10,000 support level. Recently, it recovered and climbed back above $10,300. However, the upward move was capped by the $10,350 level and the 100 hourly simple moving average. More importantly, there is a key bearish trend line forming with resistance near $10,340 on the same chart.
The pair is currently declining and is trading below the 23.6% Fib retracement level of the recent recovery from the $10,000 swing low to $10,348 high. On the downside, an immediate support is near the $10,175 level. It represents the 50% Fib retracement level of the recent recovery from the $10,000 swing low to $10,348 high. The main supports on the downside are near the $10,000 and $9,900 levels.
On the upside, there are many resistances near the $10,300, $10,350 and $10,400 levels. The main resistance is still near the $10,500 level. A successful break above the $10,400 level and a follow through above $10,500 is needed for upside acceleration in the near term.
Looking at the chart, bitcoin price is trading in a bearish zone below the $10,300 and $10,400 levels. Therefore, there is a risk of more downsides below $10,200. It seems like the price may perhaps revisit the $10,000 support. Additionally, if the bears remain in action, the price could test the key $9,900 support area.
Hourly MACD – The MACD is slowly moving into the bearish zone.
Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is now below the 50 level, with a bearish angle.
Major Support Levels – $10,175 followed by $10,000.
Major Resistance Levels – $10,300, $10,340 and $10,400.