Why I Sold My House to Buy a Bitcoin Dip
After realizing that taking out a home loan meant his property was never really his, a military man sold his home to buy instead Bitcoin to buy.
This is an opinion editorial by Mickey Koss, a West Point graduate student with a degree in Economics. He spent four years in the infantry before joining the Finance Corps.
I actually started this article almost a year ago and gave it up until the idea was revived by a Twitter space with “Toxic Happy Hour”. while listening @publishodl talking about wealth taxes there, the implications suddenly hit me in the face:
Wealth taxes and property taxes mean you never actually own anything. Always. Maybe that’s the point.
You already don’t own anything, you just don’t know it yet
In 2018 my wife and I decided to use our VA home loan benefit to buy a home in our new duty station. The house was in a nice neighborhood in a low income area so the price would allow us to rent the house out after we left to try and build some wealth and cash flow.
Fast forward two years: we have been confronted with a ruthless Black Swan event and I am not talking about COVID-19. The event I am alluding to was the moratoria on evictions that were hastily enacted during this period.
By luck and coincidence, our tenant stayed put and continued to pay rent, but had they stopped it could have spelled financial disaster. The message was clear and the precedent set: I no longer had any rights to my own property. We worked diligently to sell the house and eventually spun it off to another investor through an off-market deal and we used the proceeds to buy this beautiful, glorious bitcoin price drop in 2021.
Came for the PGU, stayed for the FGU
For me, as for many members of the military and middle class, home ownership is an essential part of long-term wealth accumulation. Especially for military personnel, the frequent moves make it difficult to do so without choosing properties that can be rented out after the move.
However, I see that the risks have increased exponentially after what happened in 2020. I no longer think that’s a viable strategy.
Furthermore, even if we paid off real estate and owned it outright, we would still owe taxes every year, and what’s stopping us from enacting another rent moratorium? Or worse, a wealth tax? It really got me thinking: don’t we own anything and just not know it yet?
It took me a while to understand this, but bitcoin is the only thing I really own. The conversations about wealth taxes and eating the rich made me reevaluate that lesson
It makes me think of Jeff Booth’s thesis above that the system cannot be repaired from within. Bitcoin is initially attractive because of the price surge (PGU) sensation, but you inevitably hit an inflection point; Will you panic sell at the first sign of danger, or will you delve deeper into the proof-of-work and uncover true value?
Bitcoin’s true value is not reflected in its daily price fluctuations; Bitcoin’s value is reflected in its ability to empower individuals. Bitcoin in self-custody is basically Freedom Go-Up (FGU) technology. Confiscation resistance allows people to exercise jurisdictional arbitrage and flee enemy territories without forced emigration taxes or penalties. It levels the playing field for individuals, a fact that will become increasingly evident in the years to come.
Freedom can only exist in a state where individual rights are protected, including property rights. What people don’t realize is that policies targeting the wealthy can inevitably be the very thing that keeps them from joining this group, despite the fact that those very policies can change and target the individuals who once supported them.
This is first-order thinking, which comes with unforeseen consequences and unplanned effects; an insidious envy based on a scarcity mentality. In a world without cash shortages, this makes everything else scarce. Property taxes solve the problem the same way revenge does, short-term gratification with potentially dire long-term effects.
If you think that the last bull market was exciting, just wait for nation states to start instituting wealth taxes. Bitcoin’s true value will be reflected over time. Until then, I will continue to stay humble and stack sats and wait for the inevitable.
This is a guest post by Mickey Koss. The opinions expressed are solely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.
Source: Crypto News Deutsch