Post
Topic
Board Mining speculation
Merits 14 from 7 users
Re: bitcoin home mining opportunity cost!
by
Heathen23
on 28/12/2021, 04:14:02 UTC
⭐ Merited by mikeywith (4) ,vapourminer (4) ,hugeblack (2) ,philipma1957 (1) ,NotFuzzyWarm (1) ,BitMaxz (1) ,JayJuanGee (1)
Nothing in this post is a financial / tax advice and I am not a financial / tax adviser. That being said,

I agree with phillipma here that we are trying to compare 2 activities that are not comparable to begin with.

Bitcoin mining and buying and holding bitcoin are not the same thing. One is a business the other is just investment.

Just like

1. Gold mining and investing in holding gold are 2 different activities.
2. Being an apartment owner yourself/ through your company and buying stock in REIT and holding real estate expecting it to increase in value are 3 different things. Although REIT passes on nearly all of its cash flow it is still not same as actively being involved in apartment business.

Bitcoin mining is a business. The business is to mine and sell bitcoin, pay for the expenses and earn profit if possible. If bitcoin is retained after mining then that is an investment decision made by the business. Why are you expecting accounting profit from this business every day? Did gold miners made accounting profit everyday in their existence? How about iron ore miners? Do all companies generating income produce accounting profit? Do you have any small business? Do your other businesses always make profit every month and year? Why are you stopping mining the moment the mining is not profitable? If your rental property is vacant or earning lower rent than expenses or in repair for few months do you sell it? If prices go down after you bought bitcoin from exchange will you immediately sell it? This whole comparison makes no sense to me.

Investment gains / loss / financing/ taxes and business gains / loss / financing/ taxes are 2 completely different things and are treated differently by the regulatory authorities as well.