Bitcoin is plunging every day to a new high, so you might be thinking why should I invest. I consulted a financial expert a couple years back when bitcoin was plunging rapidly I asked my financial advisor, whether I should invest in Bitcoin or not. His words were “We should not, it’s just a bubble and it will burst soon.” That was the time when the price of bitcoin touched the $15000 mark.I believed in him and didn’t invest. Now, when the price of Bitcoin is reaching $40K, I have two options; whether I can consider it a bubble and ignore it like before (Just to regret later) or I should invest. This time, I chose the second option. Not to cover up the mistake I made of not investing previously, but because bitcoin is a limited currency. Only 21 Millions of bitcoin are there to be mined and out of which over 18 Million Bitcoins are already mined. So, as far as I know about the market, the price of anything goes up when the demand of the item is higher than the supply.
There is a quote in the market “The best time to invest was yesterday, the second best time is today” So, you should definitely consider investing in bitcoin if you are looking to make investments.
What is Bitcoin IRA?
Everybody has their retirement funds, and I am sure you might also have it, of which you are looking for those funds to invest in various places and When you’ve decided to diversify your portfolio by investing in bitcoin, the first question that comes to your mind is where to buy and hold bitcoins? There are no broking firms and places where you can buy and hold bitcoins like the stock market. But, there are platforms which allow you to buy bitcoins or any other cryptocurrencies in their platform. Those self-directed platforms are known as IRA Bitcoin. IRA stands for Individual Retirement Account.
These IRAs are provided by the financial institutions to invest your retirement savings in any cryptocurrencies. There are many cryptocurrencies in which you can invest like Ethereum, Ripple, Litecoin, Doggecoin, etc.
How does the IRAs work:
They are directly managed by the account holder himself. No, brokers or banks or any other financial institutions manage them. They are only provided by specialized financial firms and managed by ‘self’
Pros and Cons of Bitcoin IRAs
- It diversifies your financial assets portfolio for your retirement fund.
- Returns and Gains from the investments in these IRAs are Tax-free. When you sell it at profit, you get taxed for the capital gains, but not when you hold it in IRAs.
- With the scarcity in supply, and increase in demands. Bitcoin IRAs hold a great possibility to provide you multiple times gains from your investments.
- Holding it for a long term can be the best decision while investing in bitcoin.
- The price fluctuations are so much volatile in cryptocurrencies. A sudden decrease in the price when you’re planning to withdraw funds can be harmful for your investments. So, you should play the wait game till the market rectifies itself.
- There are various types of fees like buying fees, wallet fees for holding them, Transfer fees and much more. The commission rate can go up to 10%.
- High minimum investments by some Bitcoin IRAs may not help you to invest. So, please consider looking for minimum investments before investing.
- Due to all-time trading and price change in crypto currencies, it can be difficult to track the updated rates. So, it’s better to check out the price and if it fits your criterias, but it instantly.
- Taxes are implied on your capital gains when you sell Bitcoins for profits.
After all the research and analysis, I will say investing in bitcoin will be helpful for your investment strategies. But please consider all the pros and cons of investing and using Bitcoin IRAs.
Note: I have just given advice on investing in bitcoins. So, if you want to invest please consider that there is a risk in investing and knowing that you are investing on your own will. I am not liable to any kind of profit or loss you incur.