Gifting My BTC to BlackRock (Bitcoin ETFs)

I recently decided to move my $BTC from self custody to Bitcoin ETFs.

But why would I do such a thing?

Definitely not the common “[company] has better security than I can ever have”. I don’t think that’s the case for me – my posts on self custody and cold storage are a testimony to that. And also, someone else having control over your Bitcoin completely misses the point of “owning” any.

So, what exactly motivated me to release custody over the first asset in human history that we can actually own, effectively gifting it to institutions?

I utilized them to reset my cost basis.

In other words: I’m minimizing my future capital gains tax liability by re-buying an investment at a higher price than I initially bought it for.

So instead of having $BTC acquired at $15k, I now have a Bitcoin ETF bought when $BTC trades at ~$90k.

But don’t I need to pay capital gains tax now?

Here’s where my circumstances come into play. I live in the Netherlands. Here we don’t have a standard capital gains tax implementation, so we’re free execute trades with 0% tax burden. Instead we pay wealth tax – a percentage of our net-worth every year. The Dutch tax authorities don’t distinguish whether you have X EUR worth of BTC or a random ETF. It’s all considered invested capital and taxed in the same way.

So, how am I minimizing my future capital gains tax bill when it’s currently 0%? By thinking long-term and out of the box.

If I decide to reside in a country that has “normal” tax laws, they’ll use my new cost basis to tax my eventual profits. As a side benefit, I get cleaner accounting – now I have a single buy order instead of keeping track of daily purchases during the depths of the bear market.

To read more about the concepts mentioned in this post, go to:

• Box 3 Tax in the Netherlands.
• Cash Out Millions in The EU Tax Free

I did a similar thing ~4 years ago to consolidate all my buying and selling from the 2018-2021 cycle. I choose to do a reset towards the end of a 4 year cycle because my activity lowers significantly while traditional investments become 80%+ of my portfolio again.

Besides the investing perspective, there’s also the opsec/practical perspective.

ETF exposure is strategic positioning that will allow me careless travel during a year in which I’m significantly less active in the markets. I’m without the burden of managing keys and leaving my home with nothing of serious value. Just useless furniture – no hardware wallets or pieces of paper that protect real assets.

Of course, in return you give up your sovereignty, go back to being a slave to the matrix, face uncertainty whether you’ll ever be able to access the parallel economy again, incur counterparty risks from the issuer, custodian, broker, and much much more. It’s basically an exposure to the price of Bitcoin and not its utility – like a degenerate greed-and-fomo-driven low-life trader aiming to get rich quick because daddy BlackRock and his government finally gave him a permission to take more risk.

Totally worth it.

Now I’ll go get a manicure.

Related posts:

I Didn’t Get Lucky – The Opportunity in Bitcoin How I Accumulate Bitcoin During Bear Markets Bitcoin Cycle Top Indicators Analysis Can Bitcoin Reach One Million Dollars? Exit Into What? The Curious Case of Bitcoin The 4 Year Cycle – Bitcoin Price Prediction 📈 Bitcoin Exit Strategy (Cycle Based Rotation) Bitcoin Tax in All EU Countries (Capital Gains & Wealth Taxes) (2024) Accumulating vs Distributing ETFs ETFs (Exchange Traded Funds) Northern Trust Funds vs ETFs: Full Comparison Introduction to Hardware Wallets (Cold Storage for Beginners) Inflation Explained Real Diversification – Banks, Passports, Residencies, Driving Licences, Assets Why I Stopped Covering “The Cycle”