Investing in cryptocurrency, especially Bitcoin, was at the forefront of news in the financial world in 2017 because of its record-breaking rise. However, 2018 proved to be somewhat of a disappointment for some cryptocurrency investors as it entered a bear market, producing one low after another. But it is still an investment many consider not to be ignored.
According to a recent article in Forbes, prices stabilized in December 2018, causing some experts to believe the bear market is coming to a close. According to a recent article published by Forbes, “Raghav Jerath, Founder and CEO of Gath3r, is one of them. “The current market decline is just a phase,” Jerath says. “In its short history Bitcoin has corrected 80-90% many times over. This is just another bump in the road and was overdue.”
If you’re on the fence about investing in cryptocurrency, these top 10 facts may help you determine if this asset belongs in your retirement portfolio.
Bitcoin was created in 2008 upon the introduction of a white paper authored by someone using the alias Satoshi Nakomoto.
Only 21 million Bitcoin can be produced. At the time this article is being written 17,513,525 million Bitcoin are currently in circulation. This leaves 3,486,475 of this particular cryptocurrency to be mined.
People typically refer to all cryptocurrency as Bitcoin, since it is the most popular. But, there are 9 other currencies worth noting that are favored, as well.
In fact, according to investing.com, there are 2520 other forms of cryptocurrency out there as of February 1, 2019.
Many companies accept Bitcoin and other cryptocurrency as cash payments for goods or services. This article lists some well-known businesses that do, along with other ways you can use the coin to pay for services.
As an asset, cryptocurrency is treated like personal property for federal income tax reporting purposes per IRS Bulletin 2014-16, Notice 2014-21. However, if you invest with a self-directed IRA, your IRA owns the asset not you personally. Find a gold mine of FAQs regarding cryptocurrency investing in this IRS publication.
Perform your own exhaustive due diligence before making any investment—including Bitcoin—especially in light of the downtrend resulting from last year’s volatile crypto market. For example, here’s an article about cryptocurrency scams that might make you think twice.
In the US, taxation on cryptocurrency is in effect if you use it to pay for goods or services. Better get the full details in this press release published by the IRS.
In spite of the tumultuous last year, Coinswitch predicts Bitcoin’s price to rise to $23,500 in 2019.
Before you decide to invest in cryptocurrency, read one take on what lies ahead for Bitcoin in 2019 in this article published in Forbes.
For more information on investing in cryptocurrency or to open your account, please contact us.
This article was originally published on December 13, 2017 but has been updated for accuracy.