Cryptocurrency

Investing in Cryptocurrency

Cryptocurrency provides a way to trade goods and services across the globe without government regulation or centralized oversight. Transactions are performed on self-regulating platforms that are visible for the public to see. This self-regulation ensures stability, prevents double spending, and helps create longevity to ensure value as a viable currency or asset within the broader scope of e-commerce.

Virtual currency is bought and used by individuals, vendors, businesses, and even countries who allow its use. Investing in cryptocurrency like Bitcoin, Litecoin, Ethereum, and others is possible in a self-directed IRA. Profits are paid directly to the IRA without any taxable liability other than those that apply when you retire.

Three ways to invest in Cryptocurrency

  1. Buy and sell like forex and futures trading on an online platform
  2. Invest in the blockchain mining process
  3. Invest in Bitcoin Trust, ETFs, and hedge funds

Coins-Bitcoin-Keyboard-Cryptocurrency

Woman-Typing-on-Keyboard-Cryptocurrency

INVESTING IN CRYPTOCURRENCY IN AN IRA

  • Choose a platform that can title the ownership in in your IRA’s name
  • Cryptocurrency may not be purchased personally and sold to your retirement plan
  • Make sure the platform’s investing procedures comply with IRS rules and regulations
  • For income tax reporting purposes, digital currency is deemed personal property by the IRS as stated in Internal Revenue Bulletin 2014-16, Notice 2014-21.
  • When held as an asset in an IRA, it receives the same tax-sheltered treatment as any other investment in your retirement plan.