The IRS has clarified that digital currencies such as bitcoin works like a real currency, and therefore, it can also be used for individual retirement account. In other words, investors are allowed to keep Bitcoin IRA as part of their retirement portfolio. Learn more about cryptocurrency investing here: https://www.smartbitcoininvestments.com – how to invest in bitcoin
Bitcoin has jumped in value over the past few years and this digital currency is likely to reach a valuation of over USD 100 billion in the near future. It has given excellent returns to investors over the past few years. While the growth in its value has been volatile so far, but the value of this digital currency has only gone up. You should also consider investing in bitcoin and here is a list of some of the advantages of a Bitcoin IRA.
One of the biggest advantages of investing in cryptocurrency is that it helps to diversify your portfolio. Experts recommend diversification as a way to minimize risk and therefore, it is important that you have some alternative investments in your retirement portfolio. Ideally, you should allocate up to 10% of your retirement portfolio to such alternative investments.
Bitcoin has given tremendous returns over the years and investing in this digital currency through IRA is a great way to invest in BTC and diversify your portfolio. Another big advantage of investing in bitcoin is that the self-directed IRA also receives the same tax advantages as is the case with conventional individual retirement accounts. In simple terms, investing in crypto through an individual retirement account allows investors to maximize their profitability and minimize the tax liability.
Experts recommend digital currency IRAs as these can be funded with existing retirement assets or pre-tax dollars. This allows investors to benefit from the rise in the value of such digital currencies while taking advantage of the traditional retirement accounts.
Another advantage of investing in bitcoin through an IRA is that it will keep your digital currency assets secure. You should know that a self-directed individual retirement account needs to be held by a custodian who will store this digital currency in a secure wallet and will help exchange it into dollars or other currency when you want to make withdrawals. Also, the custodian is responsible for the transfer of assets to the heirs when the account holder passes away which means the loved ones will have access to this digital currency assets even if they do not know anything about digital currencies.
While there are a number of advantages of investing in BTC through a Bitcoin IRA, but it is also important to mention here that these are not the right choice for all investors, especially those looking for short-term profits. This digital currency is expected to be volatile in the short-term but it’s expected to rise in value tremendously over the long term. Therefore, investors with a long-term investment plan should diversify and include bitcoin as part of their retirement account.
There are several companies offering investment in bitcoin through an individual retirement account. It is recommended to thoroughly check the reviews of these companies before investing to make sure your digital currency assets are safe and available to you when needed.