One of the hottest button topics in the investment world today is cryptocurrency. When you hear the term, you probably think of the famous Bitcoin, created in 2009. However, since then, a variety of these digital tokens have launched and gained notoriety in economics and finances.
If you’re curious about the hype and want to know more, continue reading! You can even use these versatile coins in your IRA accounts. Nowadays, there are whole funds dedicated to this. While some research will be required, it is not as hard as it sounds. Stick with me!
Crypto – what is it?
For many of us, this is the burning question. What is this cryptocurrency, anyway? Well, it’s not as complicated as it may appear. In simple terms, it is a virtual coin that holds value and can be used in exchanges.
There is a lot that exists right now. If you want to see a list of some popular ones, you can look here: https://www.forbes.com/advisor/investing/cryptocurrency/top-10-cryptocurrencies/. You should keep this in mind as you consider investing in them. Naturally, you will want to choose a token with good value.
What is a Crypto IRA?
The variety of options out there for our retirement funds can almost feel overwhelming, honestly. It is such an important thing to have as we get older, but many of us do not actually have a firm investment or savings plan. Thankfully, this knowledge is more accessible now than ever before.
IRA accounts are a type of retirement savings account. Traditionally they do not include alternative assets, but with a self-directed account, you are able to add things like commodity investments in precious metals and even cryptocurrency.
One of the most predominant types is a Bitcoin IRA. If you are thinking of pursuing this option, you may want to look at a BitcoinIRA.com review as you consider what is involved. You want to ensure that wherever you establish your account is trustworthy and secure.
After all, there are some cybersecurity risks when it comes to these things, given the nature of the digital tokens. While each coin has its own secure encryption and is recorded publicly, there is always a chance that it could be stolen. Just be mindful!
Now, let’s say you are looking to create a crypto IRA account. One of the things involved is storing your virtual currency. This can get a bit hairy but do your best to follow along. There are professionals who can explain some of this if you are serious about opening one of these.
When you own one of these coins you are given keys that allow you to access them. These are passwords. The best way to keep these safe is generally considered to be a crypto wallet. You can look at more details on these here: https://time.com/nextadvisor/investing/cryptocurrency/best-bitcoin-cryptocurrency-wallet/.
Even if you are placing your coins in a fund, it is important to keep them safe. You don’t want to get hacked and lose everything, after all. As can be expected, there are several different types of these wallets.
First, there are physical ones. These are usually in the form of a USB stick that you insert into your computer or laptop. These are hard to hack into externally since it is a physical objects, but since they are small, they can be easy to lose.
Of course, there are also digital versions. This could be as a mobile app or as a website. Either way, they are slightly less secure but a lot more convenient. It will certainly be up to your personal preference!
Should You Invest?
There is no simple answer here, though I tend to lean more towards “yes.” The gray area comes from the newness of crypto and how volatile it is. However, in the long-term, it certainly does not seem to be going away. For that reason, they do seem to be a sound investment.
While you may not want to stake your entire retirement on them, adding them to your portfolio is not a bad idea. They give you some diversity and can passively earn income if you play your cards right. If you’re not sure, you can always consult an advisor.