Buy a House With Bitcoins (And Travel, Too)

[Old Moparz]

Remember the thread that was started a few days back ranting about inflation? Well, in the discussion I mentioned a digital global currency called "Bitcoins" & how they are gaining popularity. Here is someone selling their home & instead of asking for typical payment, the seller will take Bitcoins.

Inflation thread: http://www.dodgecharger.com/forum/index.php/topic,99897.0.html

Maybe the next Daytona project will be listed in Bitcoins so it's time to stock up on them.  

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http://gma.yahoo.com/blogs/abc-blogs/man-lists-bungalow-bitcoins-115706957--abc-news-savings-and-investment.html

Taylor More is selling his family's bungalow with an asking price of $405,000 (that's Canadian dollars) or 5,521 Bitcoins. He would rather have the Bitcoins. The two bedroom room and one bath bungalow in Alberta, Canada, sits on 2.9 acres of land along the Crowsnest River. That part of the deal is easy to understand. Why More wants Bitcoins isn't.

"I just really believe in them and once I read my first article about them, I was hooked," said More, who is 22 and said he used to be a currency trader. "I can take control of my own money, I don't have to worry about the government stepping in and taking it and freezing my account."

Bitcoins are digital currency. One Bitcoin is equal to $72.50. There are no actual coins, but they have been growing in their use. Stores like Walmart even sell gift cards for Bitcoins.

"I have a few ventures that I am working on that involves Bitcoins and I am going to need a lot of Bitcoins to do them. I thought this might help Bitcoin gain some ground, once people see that you can actually buy a piece of property or a physical tangible thing," said More.

More would not specifically tell ABC News what he was working on, but did say, "Bitcoins are rather hard to get your hands on."

More's listing has only been up for a few days and there has yet to be an offer, but he is hoping that the media attention will help. "If someone had a partial payment in Bitcoins, I would be willing to negotiate, but I wouldn't turn down somebody who had cash," More said.

Charlie Shrem, CEO of BitInstant, a payment processor for Bitcoin exchanges and other merchants, describes the digital money as "both the currency unit and the payment system... It's as if cash had wings and it could fly."

"I think it would be great," Shrem said of More's real estate offer. "It would be a private transaction. He can sell his house to anyone in the world, it doesn't have to be from Canada, and it won't cost anything to move that money."

[Troy]

Um, but how does the government tax the sale in bitcoins?

Troy

[Old Moparz]

Um, but how does the government tax the sale in bitcoins?

Troy

http://blog.turbotax.intuit.com/2011/07/18/bitcoins-the-taxless-currency/

[Troy]

Um, but how does the government tax the sale in bitcoins?

Troy

http://blog.turbotax.intuit.com/2011/07/18/bitcoins-the-taxless-currency/

Then I can't see it surviving...

Also, if you scroll down in that link it says this: "However, while taxes aren't generated by the government, if you buy and sell bitcoins, it becomes taxable income."

My comment was specifically about the house. There's a deed and property taxes that have to be transferred. If the government can't actually determine what you paid for it then they may just assess it using their own appraisal. Not sure what all the rules are in Canada. Buying goods that don't have legal titles would be a completely different story.

And, if each one is currently worth about $72 you can't really use them for small transactions.

Troy

[Old Moparz]

I'm well aware of paying property taxes, mine keep going up.  

I was pretty sure paypal was going to be a fad & didn't like the idea of using it at first but I gave it a shot after it stayed around & is actually great for purchases. As a seller the disadvantages are fees, but guess what? That's the cost of doing business & you simply mark up the item to cover the expense like anyone else does for overhead costs. I have no plans to jump into it but others with disposable income would take the risk & stand a chance to make a killing. After seeing paypal take off the way it did I wouldn't be so quick to dismiss Bitcoin. Of course I'm not a wealthy investor so my opinion may be worth less than the US Dollar at the moment.  

From what I've read, Bitcoins can be broken down into percentages for smaller amounts. I still need to read a lot more but I do find it interesting.

Bitcoin Faq.....  https://en.bitcoin.it/wiki/FAQ#What_if_someone_bought_up_all_the_existing_Bitcoins.3F

Here's another story about it that shows it can't be ignored......
http://www.bloomberg.com/news/2013-03-22/bitcoin-virtual-currency-enters-real-world.html

Bitcoin: Virtual Currency Enters Real World

Welcome to the real world, Bitcoin. The U.S. government has officially legitimized the popular crypto-currency and other "virtual currencies" by attempting to regulate them.

The U.S. Treasury's Financial Crimes Enforcement Network published a list of guidelines Monday applying money-laundering and record-keeping rules to companies that issue or exchange these currencies. This won't affect people using Bitcoins to purchase goods or services.

The guidelines reflect rising concerns about virtual currencies' use in illegal activities, and risks associated with hacking, account thefts and software glitches, as seen in a Federal Bureau of Investigation report last year.

They also are a testament to Bitcoin's growing popularity. Bitcoins reached an all-time-high valuation of $74 yesterday. The surge in the exchange rate this week coincided with concerns that the Cyprus government would take euros from saving accounts to pay its bailout bill. Bitcoin is increasingly seen as an alternative to traditional currencies.

Created by mysterious programmer Satoshi Nakamoto in 2009, Bitcoin removes the reliance on financial institutions from transactions. The currency, which offers users privacy and anonymity, is often celebrated as "democratic" money because exchanges can occur directly between individuals. The network is a decentralized system of tens of thousands of personal computers.

The Bitcoin Foundation responded to the new guidelines in a statement Tuesday, saying the new rules could be infeasible "for many, if not most, members of the bitcoin community to comply with." The change could affect people who "mine," or create, new Bitcoins (and are rewarded with Bitcoins as payment) by making them register with the government if they transmit Bitcoins into another currency.  

Some companies anticipated the rules. BitInstant, a payment processor that exchanges dollars into Bitcoins at more than 700,000 locations, is already compliant, the Wall Street Journal reports. And there are plenty of legitimate uses for Bitcoins that could benefit from government oversight. People can use them to make purchases on the websites Reddit and WordPress, for example. One guy even listed his Canadian bungalow for sale in Bitcoins.

For Bitcoin to attract new users and larger sums of money, identification and accountability are necessary. The next step may be to increase the ease of use and integration into existing banking structures. The Bitcoin-Central currency exchange partnership with French financial firm Aqoba in December offers a model for what that might look like. The partnership allows Bitcoin-Central to issue debit cards that can convert holder's Bitcoin balance to euros, and the euro balances of the accounts can be government insured.

The buzz about Bitcoin in the euro area and the U.S.'s new guidelines are a sign: Governments can't ignore Bitcoin anymore.

[J-440]

 Forgive me as I have skipped over most of the article.  I got the jist of bitcoin but am wondering what is backing it up?  I do realize that the gold standard was abandoned long ago, but I can't get my head around it.  Virtual money for real merchandise?  Sounds like a great scam if you ask me.

[Mike DC]

As it is, we're already trading real merchandise in exchange for paper money with only virtual value. 

[duanesterrr]

Having a world wide unregulated currency probably scares a few people in Washington.  If this catches on some sort of regulation will be put in place for sure.

[Old Moparz]

This couple traveled for a 101 days using only Bitcoin. The guy is paid in this virtual currency, pays his rent in it as well. Not sure I'd give up on regular money but it's definitely more intriguing as time goes on.

http://finance.yahoo.com/news/bitcoin-couple-travels-world-using-052000833.html


Bitcoin Couple Travels the World Using Virtual Cash

"In bitcoin," Austin Craig repeated to the young woman behind the counter at the Lean Crust Pizza parlor in the Fort Greene neighborhood of Brooklyn, N.Y. "Can we pay in bitcoin?"

"In what?" came the reply.

Mr. Craig, 30 years old, was struggling to convince Nadia Alamgir of the existence of the virtual currency that has gained traction across the world, and whose value—after months of wild swings—on Wednesday reached records around $400 per bitcoin.

It was midway through a tricontinental odyssey taken with his wife, Beccy Bingham-Craig, 29, and a film crew documenting their travails, which started in Provo, Utah. Their mission: to live on bitcoin alone.

"It's been consistently inconvenient and occasionally frustrating," Mr. Craig said outside Lean Crust, "but never impossible." Lean Crust advertised itself as bitcoin-friendly but hadn't seen much virtual foot traffic. Ms. Alamgir eventually contacted the store's owner, who arrived and processed the transaction, allowing Mr. Craig to munch on several slices.