5 Key Facts to Know about the Bitcoin IRA
If you are thinking about what an IRA investment could be, it is unlikely that bit going came to mind. However the reality is that is cryptocurrency is skyrocketing in value, which means that it could be an interesting investment for a self-directed bitcoin IRA. It is impossible to escape the fact that everybody is suddenly talking about bitcoin and cryptocurrency. That does not mean however that it is also immediately something that you should invest in. Let’s take a look at five key facts to be aware of before deciding whether or not a bitcoin IRA is right for you.
5 Bitcoin IRA Facts to Know
- Self directed IRAs are popular, but they are also changing a lot as of late. More and more, people are able to have a variety of investment opportunities, with the IRS only prohibiting collectables and life insurance. This means that bitcoins can legally be used in a self directed IRA.
- It cannot be denied that the value of bitcoin has been skyrocketing. Additionally, it is likely to continue to grow. Two days, some 100,000 different merchants the world over accepted as a form of payment. Additionally, in 2010, a bitcoin was valued around eight cents and this is now worth around $6,000. While this may sound very lucrative, the reality is that it is likely to also be followed by a correction pretty soon.
- It must be questioned whether bitcoin makes for a viable investment in an IRA. Yes, the value of bitcoin is far higher than it was ever predicted to go. No, nobody knows how long it will continue to increase. However, it is still highly speculative in nature. Do not invest in it without speaking to a financial advisor therefore, and make sure that you only invest a small percentage of your entire portfolio.
- There is a global debate on how illegal bitcoin is. The strength of Bitcoin lies that it is not managed by a central bank, instead offering a decentralised open source peer-to-peer network. Well this is it’s strength for individual users, it is also precisely what government’s are afraid of so it should come as no surprise that they are doing all they can to make things slightly more difficult for the owners of Bitcoin.
- The IRS allows you to invest in bitcoins. This is a very important thing to remember, because a lot of people who are anti bitcoin will try to make you believe that you are doing something illegal. You are not. As stated previously, the only prohibited items in an IRA are collectables and life insurances. However, there is of course a caveats, which is that you can only invest in Bitcoin in an IRA if said IRA is self-directed.
Whether or not you should invest in a bitcoin IRA is entirely up to you. Only you know your personal financial situation and how much risk you can comfortably take.