Bitcoin News Weekly #23

TDLR:

• Coinbase partners with Lightspark for Lightning Network integration.

• Tether acquires another 8,888 Bitcoin.

• El Salvador is offering 5,000 free passports to experts from various fields.

• Bhutan plans to expand its Bitcoin mining capacity by 6X.

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LATEST NEWS

🙌 Adoption:

• Coinbase selects Lightspark to integrate the Lightning Network, enabling near-instant, cheap Bitcoin transactions for all its customers.

• Viareggio, Italy hosts exclusive Lightning Network Summit for entrepreneurs.

• Mr. 100, a mysterious large Bitcoin accumulator, has been consistently acquiring hundreds of bitcoins almost daily, amassing a total of approximately 60,000 BTC since November 2022.

⚖️ Legal:

• US Government transfers 30,174 bitcoin, valued at $2 billion and seized from the Silk Road hacker, to Coinbase in preparation for sale.

• South Carolina's Burkett Financial Services discloses ownership of 602 shares of $IBIT, marking the first Tradfi institution to gain Bitcoin exposure via the spot ETFs.

• BlackRock announces five new Authorized Participants: Goldman Sachs, ABN AMRO Clearing USA, Citadel Securities, Citigroup, Global Markets and UBS Securities, for its $IBIT spot Bitcoin ETF.

📈 Markets:

• Tether adds 8,888.88888888 bitcoin to their reserves, amassing a total treasury of 75,354 BTC (~$5.2 billion worth).

• Defiance files an ETF that is 2X short the daily performance of MicroStrategy.

• South Korea intends to allow citizens access to US Bitcoin ETFs if the pro-Bitcoin Democratic Party gains control of parliament in this week’s election.

⛏️ Mining:

• Bhutan partners with Bitdeer to increase Bitcoin mining capacity by 6X by mid-2025, leveraging abundant hydropower resources.

• Bitfarms invests $240 million to acquire 28,000 Bitmain T21 miners.

• Paraguay considers “temporarily” halting Bitcoin mining operations due to energy concerns.

🗳️ Politics:

• El Salvador offers 5,000 free passports to highly skilled professionals, including scientists, engineers, doctors, artists, and philosophers from abroad, with 0% tax on moving assets.

• Argentina creates a mandatory registry for digital asset service providers, both foreign and domestic.

• The Fundamental Bitcoin Rights Bill passes the Louisiana House of Representatives with a vote of 103 to 0.

Bam’s 2 Sats:

This week, I spoke with a friend who was hesitant to buy Bitcoin due to the high taxes in our current jurisdiction. Realizing how the fear of capital gains taxes can impact our actions and prompt us to make irrational financial decisions solely due to tax concerns was eye-opening.

In my view, the longer I hold Bitcoin, the more hopeful I am about potentially avoiding taxes on it. The reasoning is simple:

As time goes on and I continue to hold, I accumulate more Bitcoin, and its value appreciates. The actions I might take thereafter largely hinge on the level of profit being generated. For instance:

• Taking profit anywhere around a price level of $100K you have two options:

  • Pay 30% capital gains of $30K.

  • Move to a friendlier jurisdiction where it isn’t heavily taxed.

Naturally, moving jurisdictions or changing tax residence solely for $30K may not be ideal, but the decision can change as the amount of money we are talking about becomes more significant.

• Taking profit when Bitcoin hits $1 million:

  • Pay a 30% extortion cut (ie tax) to the government of $300K.

  • Move to a friendlier jurisdiction.

In this scenario, moving to a more tax-friendly jurisdiction becomes a natural consideration, albeit with certain conditions. For example, in places like Germany, if you are a European citizen and have held Bitcoin for over a year, the tax rate is 0%. Another option is moving to places like El Salvador, where investing part of the money can lead to residency or citizenship. Moreover, it's reasonable to expect that countries recognizing the benefits of attracting Bitcoin will become more welcoming to retain talent and capital within their borders, similar to what El Salvador is currently doing.

As the value of your Bitcoin holdings increases, it becomes a negotiation. Instead of paying the full 30% as capital gains tax, you could use a portion of that amount to purchase property in a more favorable jurisdiction and embark on a new journey. This way, you can retain the benefits of enduring multiple bear markets and earn the title of a long-term HODLER.

Stay Humble & Stack Sats,
Bam

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