Coin IRA: The Cryptocurrency Retirement Investment
Cryptocurrencies have taken the world by storm over the past several years. Ever since Bitcoin hit the mainstream in 2017, its adoption by both users and investors has continued to grow. While the focus of Bitcoin and other cryptocurrencies was initially on the development of currencies for use at the point of sale, investors soon realized that with the explosive growth potential of cryptocurrencies they could make for great investment options. And just as with many other assets, cryptocurrencies can be invested in through an individual retirement account (IRA).
The cryptocurrency wallet that enables consumers to purchase goods at a cash register also serves as a place to store cryptocurrency investments. The development of offline wallets and cold storage helps to keep cryptocurrencies safe from hackers. With a Cryptocurrency IRA, the custodian’s insured institutional storage provides investors the peace of mind that their digital assets are as safe as any other investment they make.
How Cryptocurrencies Work
Most popular cryptocurrencies don’t have a single central issuer. They are dependent on a network of computers all running the same protocol, which engages in complex mathematical calculations to verify transactions of cryptocurrency tokens. That process is known as “mining” cryptocurrencies. When transactions are successfully verified, miners are rewarded with additional units of the cryptocurrency.
In the case of Bitcoin, there can only be 21 million bitcoins ever created, and the mining process will become progressively more difficult. The last bitcoins are set to be mined sometime next century. Once all those bitcoins are mined, no more can ever be created. Many other popular cryptocurrencies have similar restrictions on their supply.
That limited supply is part of what has made cryptocurrencies so popular among consumers and investors. They know that, unlike fiat currencies that can be created ad infinitum by central banks, cryptocurrencies cannot be similarly inflated. So rather than gradually growing less valuable over time, like the US dollar, cryptocurrencies will grow more valuable over time, and their purchasing power will increase.
Most cryptocurrency transactions are recorded in a blockchain, which is a publicly accessible ledger of all previous cryptocurrency transactions within that cryptocurrency. All transactions are confirmed and recorded through the mining process. Accessible balances are calculated and new transactions and can be verified in each blockchain participant’s wallet. The record is permanent and cannot be changed, altered, or hacked.
As soon as investors realized the potential for cryptocurrencies to grow in value, they looked for a way to invest in them. With very little out there in the way of guidance, many investors were left floundering. That’s when Coin IRA stepped in to offer investors the ability to invest in cryptocurrencies through an IRA, combining the tax advantages of an IRA with the growth potential of cryptocurrencies.
Coin IRA’s Cryptocurrency IRA is the result of countless hours of planning and research. It offers one of the safest and most convenient ways to invest in cryptocurrencies. While investing in cryptocurrencies by holding your own digital wallet can offer flexibility, it is not the safest and most secure method of holding cryptocurrencies. It exposes you to the risk of theft from hackers. And if you lose your private key, your digital assets are lost forever. You also can’t take advantage of the tax advantages of an IRA account, nor can you roll over funds from existing retirement accounts into a private digital wallet, without potentially creating a taxable event.
With a cryptocurrency IRA, your cryptocurrency holdings can be made hacker-proof, with triple encryption, offline wallets, and cold storage. Your cryptocurrency IRA custodian will ensure that your cryptocurrency investment remains safe and secure.
You can also use funds from existing retirement funds, such as a 401(k), 403(b), TSP, IRA, or another account to fund your new self-directed Cryptocurrency IRA. That allows you to maintain the same tax advantages as your existing accounts, transfer funds without tax consequences, and enjoy the gains to be had from investing in cryptocurrencies. If you already have an IRA, 401(k), or another retirement plan that you would like to use to fund your Cryptocurrency IRA, Coin IRA can guide the rollover or transfer process hand in hand with you, allowing you to take advantage of this once in a lifetime opportunity.
Advantages of Cryptocurrency Investments
There’s no question that cryptocurrencies are the wave of the future. With the acceptance and usage of cryptocurrencies growing every day, their value will only increase over time. In 2010, 10,000 bitcoins were used to purchase two pizzas. Now those bitcoins are worth tens of millions of dollars. And because cryptocurrency prices are more stable than they once were, they are appealing to more and more investors who see the benefit of an allocation of their investment portfolios in addition to their stocks, bonds, and other traditional financial assets.
Check out the latest cryptocurrency prices.
A Cryptocurrency IRA also offers the same tax advantages as any other IRA. With a Traditional Cryptocurrency IRA, you can invest in cryptocurrency with pre-tax dollars, roll over existing retirement funds from a like account without creating a taxable event, and defer taxation on your gains until you decide to take a distribution. Or if you opt for a Roth IRA and invest in your Cryptocurrency IRS with post-tax dollars, all the same benefits of a Roth IRA still apply. Ultimately, you should consult your tax advisor for advice concerning any kind of IRA.
Read more about cryptocurrency IRA rules.
Investing in cryptocurrencies also helps you diversify your investments, offering both the security of portfolio diversification and the potential for significant asset appreciation.
If you’re interested in learning more about how to start a Cryptocurrency IRA, get in touch with Coin IRA today to request your free Guide to Investing in Cryptocurrency.