Before considering crypto-currency investments, consider the risks involved. The U.S. government recently warned investors against cryptocurrency investments. In addition, some inexperienced investors may not understand the volatility associated with this type of investment. For instance, Bitcoin is subject to debate over its value. The S&P 500 has seen only two 10% dropdowns in the past 50 years, while Bitcoin has experienced over ninety percent drops.
BitIRA
In April, Fidelity made headlines by announcing that investors can add Bitcoin to their retirement accounts. The news is timely, because the crypto market has lost $1 trillion in less than a month. This announcement signals the continued rise in institutional demand for crypto and the company plans to hire 110 tech and customer service workers. A digital assets account will offer employees a variety of benefits, including automated 401(k) administration, low-cost mutual funds, and human advisers.
A digital assets account will allow employees of companies that sign up to transfer 20% of their accounts to digital assets. This account will invest in bitcoin and other short-term money-market investments, providing liquidity and institutional-grade security. In addition, the DAA will let employers set a limit on the amount of bitcoin a participant can purchase and use. A plan sponsor can also choose to impose lower limits for the digital assets account.
iTrustCapital
The iTrustCapital website offers a variety of options when it comes to establishing a crypto IRA. They offer three ways to fund your retirement account, including yearly or weekly guidelines. If you plan on switching jobs in the future, you can easily transfer your retirement plan to iTrustCapital. However, you should keep in mind that it is a good idea to do thorough due diligence before transferring any retirement funds.
As a crypto-only IRA, iTrustCapital is not FDIC-insured, so you'll be paying a lot of taxes on your investment. However, there are other benefits to choosing iTrustCapital over other options. It offers a transparent, easy-to-use platform, 24/7 trading, and a low investment threshold of $2,500. In addition, the iTrustCapital cryptocurrency IRA does not charge monthly or broker fees. Instead, you'll pay a small fee for each transaction. The reviews on Trustpilot are generally positive.
MicroStrategy
The announcement of a Bitcoin 401(k) account from MicroStrategy is a move that may be a part of the company's push to be a pioneer in the cryptocurrency space. The company's chief executive is a huge proponent of the digital currency, and has invested heavily in it. Meanwhile, Fidelity has begun exploring blockchain technology and has even launched the first commercial offering in the space, which is the Fidelity Digital Assets fund for accredited investors.
The retirement plan provider has just announced that it will offer employees Bitcoin 401(k) plans. The company is targeting tech companies, particularly those with younger employees, which tend to be more bullish on cryptocurrency than older generations. The company will be the first to leverage the new product, and has not yet replied to a Money inquiry for comment. MicroStrategy declined to comment on the new offerings.
Swan
Among its offerings are a cryptocurrency IRA and a custodial service for institutional investors. Initially, the company will offer only bitcoin as an investment option, but it intends to add other cryptocurrencies in the future. It has long been at the forefront of digital asset offerings, having launched an institutional custodial service in November, and is now preparing to launch its bitcoin fund for accredited private wealth clients in 2020. However, investors should be aware that the price of bitcoin has dropped by nearly 40% since its November high. Despite the drop, Fidelity's IRA is a safe haven for investors, and its custodial service provides institutional-grade security.
As of April 2017, Fidelity has embraced cryptocurrency and is one of the first major financial institutions to offer such an investment option. It offers both traditional and Roth IRAs, and allows customers to rollover existing IRAs to purchase the new cryptocurrency. The cryptocurrency retirement plan will only allow investors to use up to 20 percent of their funds to purchase bitcoin. A 401k plan is typically the safest way to invest money and it should not be used to buy real estate.
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