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RE: New Cryptocurrency Investment Vehicles Are On The Way!
Great post, look forward to seeing more ETF's and other investment options as a way to trade with quicker liquidity.
One thing a lot of people may not realize, because it's not obvious when buying it, this "stock" also complicates their tax situation (if bought outside an IRA) as GBTC is a grantor trust for income tax purposes. It is not the same as buying a stock on the stock market, the buying/selling that occurs within the fund is treated as if the owner of the shares actually did the buying/selling. I posted on the subject recently.
Steem on!
Interesting, what are the differences for tax purposes?
So for buying a normal stock in a corporation, when someone buys it, there is generally not a tax consequence until they sell the stock ; other than maybe receiving a dividend. For GBTC, however, even if someone buys and HODL's the shares, there are tax consequences that might need to be reported on the investor's tax return each year, as the trust makes buys/sells. It's treated as if the investor bought/sold Bitcoin directly (based on their percentage ownership in the total trust). I get into a little more in the article below with a link to some resources, the 2017 trust statement wasn't out yet as of when I wrote it:
https://steemit.com/bitcoin/@cryptotax/bitcoin-investment-trust-gbtc-not-as-simple-as-owning-a-stock
Ah yes that does make sense, especially with this new fund coming that states they are going to rebalance every quarter. We desperately need these tax laws changed.