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Should You Invest in a Cryptocurrency Retirement Plan?

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invest in Cryptocurrency Retirment Plan

This is a guest post submitted on CryptoTapas.

As our industry evolves and changes the job market changes along with it. While consistent technological advancements usually come with a ton of good, it has also brought as to a point of living in the age of increased uncertainty. Entire professions are dying out and certain technical skills are becoming obsolete.

As the years go by, the concept of job security is fading away slowly which has led to some drastic changes in the way we think about our careers. Modern professionals have more freedom but that freedom comes with a side of fresh responsibilities and difficult choices to make.

In a world of changes and uncertainty, developing a sense of financial security has become an increasingly difficult task. So if we’re losing all of these assurances about our work life, what does that mean for the ways we save for a time after our careers have ended?

How to Retire In This Day and Age?

The increase in average life expectancy has made the task of setting aside sufficient income for retirement more challenging and people are not getting ready. A recent survey has shown that only 10% of the people in the US have a formal retirement plan set up and the idea of working after your statutory retirement age is becoming a real strategy for many.



how to invest in cryptocurrencyThose seeking security have shifted the discussion from retirement to financial independence which is changing the focus from age to finances. Even though it’s not easily obtained, the key benefit is that with it comes a belief that you are the one who is in charge of your finances throughout your whole life. Thinking about financial independence is an inherently active approach.

Those who are trying to achieve financial independence usually have a better understanding of their finances. They are probably more likely to stay up with the current trends in the business world and one of the biggest current trends is, of course, cryptocurrency.

In recent years, cryptocurrency has become a dominant topic all over the world, consistently raising more and more attention from potential investors. No one knows what the future will bring for sure yet many believe that we’re still in the early stages of the cryptocurrency era. But could it be a strong asset to your retirement plan?

3 Ways of Developing a Retirement Plan That Includes Cryptocurrency

ways to invest in cryptocurrencyThere are several ways to incorporate cryptocurrencies into your overall retirement plan and strategy. One of the easiest and most common ways is to create a self-directed IRA.

An SDIRA is a specific type of individual retirement account provided by trustees or custodians. It allows you to hold various investments within your account. Things like stocks, gold, real estate and more importantly, digital currency.

Self-directed IRAs that can hold cryptocurrency are also known as Cryptocurrency or Digital IRAs. A key distinction between a self-directed and a traditional IRA is that an SDIRA is managed by the account holder. This will help you gain greater control over your finances and future, but it does come with some extra responsibilities.

If all of this sounds like a whole lot of work to you, there are simpler ways of approaching the matter. There is an increasing number of companies that specialize in combining cryptocurrencies with your individual retirement accounts. Even though this would make the process a lot easier, it does come with additional fees.

Lastly, there’s always an option of investing in crypto as a way of saving money but without merging it with your official retirement plan. It might be less of a hassle but you will miss out on the tax benefits. Even though we consider it digital currency, the IRS still treats crypto as property which is why you should learn about crypto taxes if you plan on taking this route.

The Upsides 

  • It’s a Way of Diversifying Your Portfolio

crypto portfolioDiversifying your investments is one of the key principles of low-risk financial management and the same goes for your retirement plans. Along with things such as real estate investment and creating multiple streams of passive income, investing in cryptocurrency can be a great angle for your diversification strategy.

There have been some success stories in recent history where people went with the cryptocurrency retirement plan and came up on top. In 2017, a physicist who educated himself on the topic of virtual currencies via YouTube invested 15% of his retirement fund and ended up increasing his value nine times. Success stories like this one can make people get very excited but financial advisors still recommend that you should be careful with your investments and make sure to keep them between 5 and 20%.

  • It Allows Tax-Free Growth of Your Cryptocurrency Investments

If you’ve decided to take the route of opening up a Digital IRA then your investments in Bitcoin or any other cryptocurrency will grow completely tax-free. As long as you keep these funds within your account, you are not required to pay any tax fees on them. The only way these funds will become a subject of taxation is when you decide to make a distribution.



  • It Operates Under a Decentralized Infrastructure 

One of the main advantages of cryptocurrency retirement savings is that you’re investing in a decentralized infrastructure. Being a part of a system that is independent of centralized institutions comes with the advantages of being unaffected by the actions of central banks and governments.

This is a great benefit because it keeps your investment safe in cases such as bank failures. One of the main reasons for creating a blockchain-based, decentralized cryptocurrency is so that people could avoid being impacted by events similar to the 2008 financial crisis.

Another thing cryptocurrency can save you from is the effects of inflation, in case you’re investing in those that have a hard cap. Bitcoin’s is set at 21 million dollars, meaning no entity will be able to simply invent or print out more and decrease its value.

  • It Has Great Long-Term Growth Potential

Long Term investments in cryptocurrencyPutting aside the significant growth in value Bitcoin has experienced this year, there are still other valid indicators that suggest crypto is here to stay. The rise in crypto-specific patent applications along with the rising interest coming from tech giants are just some of the signals that very big players believe in the future of cryptocurrency.

Discussing the potential of a relatively new system is a controversial topic but there are certainly reasons why many experts and big company executives believe cryptocurrency has huge long-term potential for growth. A recent comment made by Apple Pay vice president Jennifer Bailey has stirred this discussion even further.


The Downsides

  • It Carries a Lot of Uncertainties 

Investing in CryptoThe fact of the matter is that with both crypto and blockchain we’re all very deep in uncharted territory. Economic experts are divided in their opinions at best and their predictions range broadly from incredibly optimistic to disappointingly pessimistic.

One of the reasons for these discrepancies lies in the fact that certain characteristics of the system are open to interpretation. For example, the volatility of cryptocurrency can be considered to be both a strength and a weakness of the system.

Bitcoin is only just about a decade in existence which is too short of a time-frame to really understand and predict how a financial system will look like in the future.

  • It Has Significant Added Fees 

Trading in cryptocurrency through your IRA comes with different types of fees which vary depending on the custodians or trustees providing you with the account. These trading fees usually vary depending on the type of crypto so if you’re considering making an investment, make sure to take these variations into consideration.

  • It Comes with Additional SDIRA-Related Risks

Every self-direct IRA carries specific risks which is something you won’t be able to avoid if you’re looking to maximize the benefits of tax-free growth. The risks come from the fact that SDIRAs have a set of strict rules you must adhere to in order to avoid paying penalties or getting charged with fraud. SDIRAs also come with a set of fees like a one-time establishment fee, a first-year annual fee, annual renewal fee, and fees for investment bill paying.

All of this burden is that much heavier because you have to carry it all by yourself since custodians can’t legally offer financial advice. Finding a good financial advisor is an option but it’s also not very cheap.


Should You Do It? 

With everything considered and taken into account, we can certainly say that it’s not the simplest, easiest way nor is it the safest way of setting up a retirement plan. If you’re not even the least bit familiar with cryptocurrency you should probably either figure out another way or look to educate yourself on the subject.

Another thing we can conclude with confidence is that cryptocurrency shouldn’t be considered an all-in strategy, at least for the foreseeable future. The huge potential gains are very exciting but you need to remember what’s on the line.

Those who are uncomfortable with sizable fluctuations in their finances should look to other places to invest their money. Or if you’re close to retirement and don’t have a lot of funds to spare, it’s probably best to sit this one out. Losing your health over the stress of rapid changes in the crypto market is just not worth it.

On the other hand, if you’re still a fairly long way away from getting out of the game and have a few bucks to set aside, cryptocurrency just might be a great thing to try. If you’re smart about it and approach it gradually you can surely set up a scenario where the potential gains drastically outway the potential losses.

Thank you for reading the article.

AuthorBio: Mark is a biz-dev hero at Invoicebus – a simple invoicing service that gets your invoices paid faster. He passionately blogs on topics that help small biz owners succeed in their business. He is also a lifelong learner who practices mindfulness and enjoys long walks in nature more than anything else.

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IMPORTANT DISCLAIMER

Everything in this article is an opinion, not an advice of any kind. This material has been prepared for general informational purposes only and it is not intended to be relied upon as accounting, tax, investment, legal or other professional advice. Please consult with a professional for specific advice.

This is a guest post. We do not endorse or guarantee the accuracy of the information and claims made.



CryptoSpace

Crypto Roundup: All Your YouTube Influencers in One Place

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Crypto Roundup

Visit our Crypto Roundup section daily for a dose of all your favorite Crypto YouTube influencers in one place.    

Worried about missing updates from your favorite YouTube crypto influencers?  

Welcome to the Crypto Roundup.  

On this page, we will post a quick summary of the videos from some of the most popular YouTube crypto influencers.

Ivan on Tech  Altcoin Daily

Crypto Zombie Box Mining

Ellio Trades Lark Davis

Data Dash Bitboy Crypto

MMCrypto Chico Crypto

Altcoin Daily

Video title: Bitcoin Will Be OVER $20,000 By Christmas 2020! BIGGEST WEALTH SHIFT OF OUR LIFETIME! Cryptocurrency

Date: 19-Nov-20

  • World’s biggest wealth shift of our lifetime is happening right now and no mainstream media is talking about it, except CNBC.

  • Preston Pysh predicted on August 26th that: “Bitcoin should be reaching its all time high by Christmas.”

  • If you are looking to buy a dip, there may not be one.
  • Ricardo Salinas Pliego, a mexican billionaire, has just revealed that 10% of his liquid assets are into bitcoin.

Lark Davis

Video Title: STOCKS HIT NEW HIGHS! WILL COVID VACCINES LEAD TO MEGA PUMP IN 2021? [Are You Ready?]

Date: 19-Nov-2020

  • Stock markets and bitcoin pumps higher on the news of the second successful covid vaccine.
  • There could be more chances for the new stimulus. Means more inflation, more debt and simultaneously pumps stocks, gold and bitcoin.

Crypto Zombie

Video Title: BITCOIN $18.5k TOP!!?! DON’T BE FOOLED!! HODL FOMO BEGINS!!! $TRILLIONS FLOOD!!

Date: 18-Nov-2020

  • Overall sentiment of Bitcoin has changed drastically from ICO craze in 2017 to a time where people are FOMOing to own more bitcoin.

Ivan on tech 

Video Title: BIG WARNING TO ALL HODLERS!!!!!!!!! DO NOT GET REKT!!! BITCOIN $18,500 REJECTED – NOW WHAT?

Date: 18-Nov-2020

  • Ivan expects bitcoin to shoot past $20K resistance before end of this year, giving it 85% probability

Chico Crypto

Video Title: World’s Most Powerful Turn BULLISH on BITCOIN

Date: 19-Nov-2020

  • All those who hold big bags of Bitcoin will come out of the shadows to talk up the Bitcoin rally, a $20K bitcoin could be on the cards before the end of this year
  • Ethereum mining could act as a big catalyst for Ethereum’s price
  • Big companies like google could play a bigger role in mass adoption of crypto

Let the FOMO begin…

Thank you for reading and sharing this article. We appreciate you.

Stay safe and healthy!

Top 5 Cryptocurrencies 2020

IMPORTANT DISCLAIMER

Everything in this article is an opinion, not an advice of any kind. This material has been prepared for general informational purposes only and it is not intended to be relied upon as accounting, tax, investment, legal or other professional advice. Please consult with a professional for specific advice.

We do not endorse or guarantee the accuracy of the information and claims made.

All product and company names are trademarks™ or registered® trademarks of their respective holders. Use of them does not imply any affiliation with or endorsement by them.

Continue Reading

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Lessons from the Veteran HODLERS to the Newbies!

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Lessons in Crypto

For all those who entered the crypto market after the 2017 bull run – here are few lessons from the HODLERS from the last bull run(s).

This is our attempt at making all you newbies aware of the mistakes veteran cryptoers did.

Let’s get started…

Don’t FOMO in to all the hype

FomoIt’s hard not to FOMO in crypto.  The trick is to make sure you don’t lose your shirt in crazy bets.  Always limit your bets to what you are comfortable losing.

The common ways you can become victim of FOMO are:

  • Following your favorite YouTuber without actually doing your own research on the project.
  • Investing into projects at the top.
  • Believing in promises of 100x or 1000x without any substance behind those claims.

HODLing far too long

Remember why you are into crypto – to make the money.

Never fall in love with your crypto, and HODL the tokens even when they are 10x and more.

Have a strategy to take your capital out before you become a HODLer.  

If you believe the project really has what it takes to go beyond 100x and more, just sell in instalments so as to not miss the ride.

One of the best ways to HODL is to take your capital in full and profit in tranches.

This rekt story will give you a right perspective of what it looks like, it’s one of many:

Don’t put all your eggs in one basket

Never go all in on one project. No matter how strong the project may look, even the projects with strong fundamentals don’t do well sometimes. 

And, you will be kicking yourself watching other projects go up and your portfolio just doesn’t seem to make a move.

And don’t over do it and have a portfolio with over 100 projects either. It is very difficult not to have invested in more than 15 projects but anything less than 20 is a good way to go, in our opinion. 

Put aside the share of Profits for Taxes.

One way you can get a good night’s sleep is by paying taxes. 

Always keep a habit of putting aside a % of your profits in USDT or other stable coins, as a reserve to take advantage of market volatility and also to meet your tax obligations. 

Exchanges are more evil during bull run

Foreign ExchangesDon’t trust exchanges. Yes we already know that, but they play more games during bullrun, some intentional and some technical. 

Many exchanges tend to go under maintenance when the prices shoot up too high too soon (Coinbase?), and you can’t sell. 

And the shady exchanges scam out before you know.

Regulators seem interested when the market cap of these projects goes through the roof, which then adds FUD around the project crashing the prices.  

Exchange may freeze funds pending investigations when such issues arise.

Take for example OKEx. Users are unable to withdraw their assets from the exchange for almost a month now, not certain if they ever will, and all that started with the legal dispute.

Never fall for Arbitrage gains

Arbitrage is when you buy in one exchange at a lower rate and sell on the other for a higher rate to take some profits. 

Some shady exchanges show a lot higher prices than the other genuine exchanges and when you deposit your assets to sell at those prices there won’t be actual volume to execute the trade. You may be stuck with either a high fee for withdrawal or other funky rules to take your own money out. 

Remember, there is no free Giveaway

Free CryptoScammers rise with the rising market.  

When the crypto market buzzes with all time highs – scammers cash in big time on newbies.

The most lucrative scam in crypto is ‘Free Giveaway’. Whether it be through YouYube ads or discussion groups and wherever they can get your attention.  Read this article on various sophisticated scams that are being deployed.

We hope these lessons help you through your trades and crypto life.  Stay safe and always DYOR.

Thank you for reading and sharing this article. We appreciate you.

Stay safe and healthy!

Top 5 Cryptocurrencies 2020

IMPORTANT DISCLAIMER

Everything in this article is an opinion, not an advice of any kind. This material has been prepared for general informational purposes only and it is not intended to be relied upon as accounting, tax, investment, legal or other professional advice. Please consult with a professional for specific advice.

We do not endorse or guarantee the accuracy of the information and claims made.

All product and company names are trademarks™ or registered® trademarks of their respective holders. Use of them does not imply any affiliation with or endorsement by them.

 

Continue Reading

CryptoSpace

Crypto Roundup: All Your YouTube Influencers in One Place

Published

on

crypto news

Visit our Crypto Roundup section daily for a dose of all your favorite Crypto YouTube influencers in one place.    

Worried about missing updates from your favorite YouTube crypto influencers?  

Welcome to the Crypto Roundup.  

On this page, we will post a quick summary of the videos from some of the most popular YouTube crypto influencers.

Ivan on Tech  Altcoin Daily

Crypto Zombie Box Mining

Ellio Trades Lark Davis

Data Dash Bitboy Crypto

MMCrypto Chico Crypto

Altcoin Daily

Video title: The United States Just Brought Bitcoin into the National Conversation!! | Cryptocurrency in 2021

Date: 16-Nov-20

  • Former National Treasurer and the new US Senator Elected, Cynthia Lummis, said Bitcoin fits the bill as a good store of value as it is finite and limited, unlike the inflationary fiat currency.

  • Grayscale adds over 7000 more bitcoin in just the last 24 hours.
  • Just over 16% ETH staked for ETH 2.0 launch on Dec 2 2020.
  • Bitcoin Cash hard fork takes place tomorrow.

Crypto Zombie

Video Title: WARNING!!! BITCOIN 2017 BEAR FRACTAL RETURNS!!! BTC WORST CASE SCENARIO…

Date: 14-Nov-2020

  • Institutional money starts flowing into bitcoin.

  • Paypal goes live with its crypto trading platform for eligible customers. They have also raised the buying limits from the initially set $10,000 to $20,000 per week.
  • DIA, an DeFI Oracle provider, integrates with Polkadot.

Ivan on tech 

Video Title: BITCOIN WILL DO SOMETHING INSANE THIS WEEK!!!! -30% DUMP AHEAD vs $20,000 PARTY – Programmer

Date: 16-Nov-2020

  • Bitcoin could make a big move this week, either hit 20K or we may see a 20% to 30% drop
  • Chainlink partners with Etherisc to deliver agricultural insurance in Kenya.

Ellio Trades

Video Title: UNLOCKING $100 TRILLION? This low cap gem seeks to bridge CeFi and DeFi

Date: 15-Nov-2020

  • DeFI could be similar to the ICO craze in 2017
  • Low cap gem: AllianceBlock
  • AllianceBlock is bridging the gap between DeFi and CeFi
  • AllianceBlock Partnership with Orion Protocol and Chainlink.

Chico Crypto

Video Title: WARNING! An “EVIL” Entity Wants Control of BITCOIN…

Date: 15-Nov-2020

https://www.youtube.com/watch?v=45Ac-5y2ofg

  • 90% of Bitcoin’s mining pools are controlled by China based mining pools
  • As the value of bitcoin goes up – there is a threat of push to ‘control’ the network from China
  • Binance is looking to push through the 50% mining share and Chico believes this could be dangerous

Visit our Crypto Roundup section daily for a dose of all your favorite Crypto YouTube influencers in one place. 

Thank you for reading and sharing this article. We appreciate you.

Stay safe and healthy!

Top 5 Cryptocurrencies 2020

IMPORTANT DISCLAIMER

Everything in this article is an opinion, not an advice of any kind. This material has been prepared for general informational purposes only and it is not intended to be relied upon as accounting, tax, investment, legal or other professional advice. Please consult with a professional for specific advice.

We do not endorse or guarantee the accuracy of the information and claims made.

All product and company names are trademarks™ or registered® trademarks of their respective holders. Use of them does not imply any affiliation with or endorsement by them.

Continue Reading

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