I have a question I hope someone has already solved. On the exchanges decred(and all coins) are traded in BTC. When you are moving coins back and forth(some people call this trading, I call it losing) you have to keep track of the fiat price you buy/sell a coin at. With the volatility in coins you could buy decred at .0092 today then sell it at .0093 the next day and not make any money or worse actually lose money if btc dropped in price. How are those of you that trade keeping track of your actual cost/price for each transaction? I have been messing around and just using a spreadsheet to track my in and out price in fiat as well as btc.
If you bought at .0092 and sold at .0093 (and ignoring exchange fees), then you have won regardless of what the price of Bitcoin did in the meantime. You've turned .0092 BTC into .0093 BTC, and gained a little over 1%. If you're worried about the fiat exchange rate, you need to be trading into fiat as well.
Yes I agree. Thats why I said this above. I was asking for input on exactly how people are doing this as my method seems cumbersome. Tools or websites that assist with keeping two moving targets in sync.
As much as the spreadsheet method sucks, it is the best way I know. Even when I worked at a hedge fund years ago we did all of our P&L over thousands of stocks in Excel.
+1 on Excel spreadsheets. I keep track of my trades in terms of BTC and DCR only. I do still have a USD section just for a rough overview but I don't use it for tracking each trade. Why do you say you have to keep track of the fiat price you buy and sell at?
I am amazed that people even say this actually. If I were day trading, which I am not, how could I NOT keep track of the fiat price I am using? Any change in the price of BTC would affect everything. Let me see if I can describe it as I see it. 1 btc = 1000USD 1 dcr = 100USD I buy 1 btc @ 1000USD I buy 1 dcr @ .1btc I then sell 1 dcr @ .1btc but now 1 btc is @ 900. BTC dropped by 10%. As all things are measured in btc at this time I have lost money as measured in fiat. If I were to convert this back to fiat after these trades I would only have 990USD. But the price of dcr never changed. There was a hidden loss in the value of dcr due to it being measured in btc and not fiat. I think my math is correct to illustrate the point. This is a very simplified version to make it clear but this type of situation is present in every trade. If you dont track it you can lose money you dont even realize you have lost if you dont have an unchanging point to measure from, in this case USD. The exchange I use only logs trades in BTC. As BTC price moves the logs become useless as there is no logging of btc<->fiat at the time of the trade. There is no reference point other than a manual check of the price that must be added and correlated which equals more work and is prone to error or even misreading due to flattening of chart averages over time.
As before, this only matters if you're trading in fiat, because what's actually going on in this scenario where you bought 1DCR at 0.1USD and then sold it at 0.1USD is that you bought 1 DCR for 0.00001 BTC, but then sold it back for 0.000009 BTC. This is an obvious loss, regardless of what the fiat values have done in the meantime. Even if, in that sale, 1DCR grew to 0.9 USD and 1BTC grew to 10000 USD. Your example claims this would be a gain, but you've still *lost* 10% of your value as measured in BTC, and if you hadn't made the trade in the first place, you'd still have a full $1 in crypto instead of the 90 cents you now have. The only values that matter in a trade are the relative values of the two currencies being exchanged.
In fact, I *don't* want my exchange to be showing values in fiat unless it also allows trades into and out of fiat, because then I could make the mistake of buying a coin for $1 and then selling it for $9, and congratulate myself for my 800% profit without realizing I've actually taken a 10% loss.
If I could use crypto as exchange anywhere for anything I would agree I dont care. At this point in time I dont see how that view is possible. Which was why I asked the question. Everything is measured in fiat in the real world. Just as oil is measured and traded in barrels not the gallons of gas or diesel or other products you can get from it. My point was you could trade 1000s of times and make "profit" in crypto only to be smashed when you convert to fiat. How is this not important?
If you're trading 1000 times in crypto and making a "profit" only to be "smashed" in fiat, then you should have been invested in fiat in the first place. As I already pointed out, your logic states that if I trade 0.0001 BTC for 1 DCR, then trade 1DCR for 0.00009 BTC, but the price of Bitcoin goes up to $10,000 in the meantime, then I have *somehow* made a profit. In which case, frankly, I should be offering you several abusive trading offers, since you're going to think that you're the one coming out ahead. Again, the *only* values which matter are the currencies being exchanged. The value of fiat is only important enough to record on an exchange where fiat is a valid exchange currency, and, in fact, is undesirable to have if you are only trading between cryptocurrencies.
I think drunkenmugsy has a point in that everything is ultimately measured in fiat (at least at this point in time). If you're trading many coins against each other, then fiat is a good point of reference, because there is no other way to track whether you're making a loss or not (i.e. it's not like you're solely going from dcr to btc and vice versa where it's clear what your profits are without fiat). Is it a valid reference point? I believe today it is. For example, let's imagine a simplified case where you do indeed trade dcr to btc (and ignoring exchange fees). Let's say btc and dcr start at 1dcr = 1btc = $1, and you have dcr. Say dcr goes up twice relative to btc. Now 1dcr = 2btc = (!) $2. Note that because fiat is a common point of reference, by doubling relative to btc, dcr doubled relative to fiat as well! Next, you sell your dcr for btc and now have 2btc. Then, btc suddenly doubles relative to dcr. But wait, there's 2 ways that could happen! Either btc grows relative to fiat while dcr stays the same relative to fiat, or dcr falls relative to btc and fiat. Either now 1dcr = 1btc = $1, or 2dcr = 2btc = $4. Now you decide to sell your dcr for btc. Assuming the first scenario, you have 2dcr = $2. However, in the second case you have 2dcr = $4. So what your profits are certainly dependent on what happened to crypto/fiat prices. Of course, you can come out on top in either scenario (because if the trend keeps going either way, you're doubling your dcr/btc every other cycle), but suppose we now trade in many different alts. Now the only common reference point becomes fiat (because let's admit it, in the end we want fiat in this day and age), so whether a trade makes sense or not should depend on that common reference point. So it's definitely a nice statistic to have unless you're only trading a pair of coins against each other.
"there is no other way to track whether you're making a loss or not" If you can't think of any way to track gains and losses in currency speculation without comparing them to fiat, you shouldn't be doing it. Doubly so since if you're *only* comparing to fiat, you're going to screw yourself.
Right now altcoins "going up" or "going down" typically refers to fiat terms. That's how the world thinks. When you need to spend your alts, you transfer them to fiat (or to bitcoin then to fiat). I'm never "only" comparing to fiat, but it's a statistic I keep track of among other things, especially when trading many different alts. Proud to say I haven't messed myself up in any way doing it the way I do right now, getting goxed aside. Then again, I typically trade for the long term, so it's rather obvious when I'm making a profit (crypto or fiat) anyway.
Yes @ClokworkGremlin, I 100% agree. Fiat prices are irrelevant when it comes to trading crypto, until it comes time to trade crypto for fiat. The only time I could see fiat prices be relevant is the following scenario, where you start with fiat and end with fiat: Purchase BTC using fiat, then trade BTC for an altcoin. Trade your altcoin back to BTC, then sell your BTC back for fiat.
Until a normal person can live their life using *insert altcoin here* Fiat is still relevant regardless of what us zealots think. The scenario anvoice describes is exactly what I am talking about. You have multiple moving targets to track in relation to each other. Who would not at some point want to go to fiat/PMs? It looks like a few people did recently before the Segwit signal was above 80% to the tune of billions of fiat. There was no safe haven in crypto, any crypto, from what I saw.
If you are trading between Crypto and Fiat, then the relative price of that coin and whatever Fiat currency you're trading in are relevant. If you are trading between Crypto and Crypto, then the relative prices of the currencies being traded between are relevant. Using a currency not involved in the transaction as your profit metric will give you false results.It doesn't matter whether that currency is USD, BTC, or Potcoin.
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