Whenever you turn on the news and look at financial reports, you will get very conflicting opinions on the pros and cons of Bitcoin and other cryptocurrencies. Some say they are too volatile to even consider as an investment, others say that the exponential growth of these currencies are the exact reason why everybody should now understand that it is a good idea to open a bitcoin IRA. In fact, there are some clear benefits to opening an individual retirement account that allows in cryptocurrencies such as bitcoin and ethereum.
Open a Bitcoin IRA to Get Important Benefits
- An IRA is government approved and you can link it to various cryptocurrencies, although ethereum and bitcoin are the most popular. This matters because it means that the United States government recognizes these investments.
- Currencies such as bitcoin, litecoin, ripple, and ethereum are resistant to inflation and hyperinflation, stock market crises, and real estate bubbles. This means that they are a reasonably safe investment, offsetting the risk associated with their volatility.
- A bitcoin IRA also allows you to include other forms of investment. It is a self-directed account, which means you can also include the different assets that are seen in traditional, rollover, and Roth IRAs. The only difference is that you are also allowed to include cryptocurrencies. It is up to you to decide what percentage of your overall account goes to these types of investments.
- When you invest in a cryptocurrency IRA, you get all the benefits in terms of your taxes as you would with a 401 k or any other IRA.
Where to Open a Bitcoin IRA
Because this type of IRA is still reasonably new, there are not yet many custodians that allow them. In fact, that is perhaps its only downside because you are effectively limited as to where you can hold your retirement investments. That being said, they are becoming more popular, which also means that you can now do a little bit of research and find the one that is most suitable to your particular needs. Some of the things you should look for include:
- That the organisation that holds the Bitcoin IRA for you is experienced and understands the concept of cryptocurrencies.
- That they are backed by the government and therefore operate according to the IRS rules in relation to investment accounts.
- That they offer you a secure bitcoin wallet with multi layer security systems, thereby ensuring your funds are safe from theft. Indeed, cryptocurrencies can quite easily be stolen and because the transactions cannot be reversed, once they are lost you cannot get them back.
- That they allow you to invest however much or however little you want in cryptocurrencies. This type of IRA is self-directed, which means you get to make the decisions. While it is beneficial for them to provide you with advice and guidance, you must ultimately be in control.
Investing in a bitcoin IRA is the way of the 21st century and you should not be left behind.