New consumer interest in bitcoin is trickling up into traditional retirement savings products and tax-advantaged vehicles like Individual Retirement Accounts (IRAs).But while a new phenomenon, cryptocurrency IRAs are no different than IRAs invested in more traditional options like stocks and bonds.Holders of IRAs can deduct contributions from their income tax every year until the commencement of disbursements, currently at 59.5 years old in the US.However, while there is no legal difference in an IRA account's status based on the investment, most popular IRA providers only allow pre-approved investments, not more unusual options like cryptocurrencies or private equity and property.According to data from Greene IRA, 38% of Americans use IRAs as a type of retirement savings.Currently, the firm BitcoinIRA is the only option for investors who wish to hold cryptocurrencies in their IRAs directly, using Kingdom Trust and Palo Alto-based BitGo for storage.BitcoinIRA took its first accounts in June 2016, and just recently began offering ethereum IRAs as well.

(The firm even boasts former US Mint director Ed Moy as an advisor).Investors with 401ks through their employers can transfer those funds into such IRAs under certain circumstances.Damon Smedley, a BitcoinIRA investor, who lives in Portland, Oregon, opened an account with BitcoinIRA last year.bitcoin pool efficiencyA former manufacturing engineer for a major technology company, Smedley bought his first bitcoins in 2013 and has monitored the price since.bitcoin rare pepeThat's a typical profile for early BitcoinIRA investors, said Chris Kline, chief operating officer of BitcoinIRA.dogecoin redditBut increasingly, Kline said, he has seen inquires from people who were less interested in the technology and were instead motivated by the uptrends in digital currency prices.bitcoin worthless

"We've had experts and novices, 25–75 age range, an even mix of gender and a blend of reasons for looking at bitcoin."BitcoinIRA charges a one-time upfront fee of 15% on deposits of $15,000–$100,000; 13% on $100,000–$200,000 placements and 11% on those $200,000 and above.bitcoin armory too slowKingdom Trust, a self-directed IRA provider and BitcoinIRA partner, also charges a custodian fee for holding bitcoins in a multi-signature wallet, enabling investors to verify funds in real-time.bitcoin armory too slowKline said BitcoinIRA has seen a surge in interest as bitcoin prices have skyrocketed.To date, the price of bitcoin has almost doubled this year: from just under $1,000 at the end of 2016 to nearly $2,000 today.Considering this growth, Kline expects cryptocurrencies to one day be as commonly held in IRAs as stocks or bonds.

Indeed, if there is one asset class well suited for retirement savings products like IRAs, it might be deflationary cryptocurrencies like bitcoin, which increase in value over time.(It's important to note, however, not all cryptocurrencies are deflationary by design).Notably, too, ethereum has climbed 900% since the beginning of the year, and the combined market cap of all cryptocurrencies has spiked 80% over the last month alone.Another option for some IRA investors, who would like to benefit from the price increases without holding cryptocurrencies, is private placement with products offered by Grayscale Investments, a digital currency startup providing products for high net-worth investors and that works with IRA administrator The Entrust Group.For its products, investors must be accredited, which means a net worth of over $1m or income over $200,000 in each of the last two years.Both BitcoinIRA and The Entrust Group administer 'self-directed' IRAs, which means the account owner is responsible for their investments, including understanding the tax consequences.

That's why the Government Accountability Office issued a report in January calling for more clarity on the tax consequences of less-common IRA investments so that investors are aware of the risk.For example, the IRS classifies virtual currencies as property today.Officials with the IRS have started compiling data on alternative investments in IRAs, including cryptocurrencies, and said in statements they plan to release findings sometime this year.Disclosure: CoinDesk is a subsidiary of Digital Currency Group, which has an ownership stake in Grayscale Investments.Bitcoin and money image via Shutterstock The leader in blockchain news, CoinDesk is an independent media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies.Interested in offering your expertise or insights to our reporting?Contact us at [email protected]/* */.

One of the world’s hottest assets is also the newest way to invest for retirement.But it carries the most old-fashioned risk of all: losing buckets of money in the blink of an eye.Since last June, Bitcoin IRA, a firm based in Sherman Oaks, Calif., has been offering Individual Retirement Accounts that can provide […] Subscribe or Sign In Popular on WSJ Most Popular Videos Film Clip: 'The Big Sick' A New Road to Income: Barron's Buzz 'Bridge Crew': Voice Command Comes to 'Star Trek' VR Videogame Lower Your Wireless Bill With These Tips Opinion Journal: Macron vs.Download PDFSee All Bitcoin Bull Watch™ April 21, 2017 Bitcoin users double every year, Bitcoin parallels Internet’s rate of adoption Google Trends depict an exponential rise: There are many ways to track the number of people who are actually using Bitcoin to transact in exchange for goods and services.While the Bitcoin exchanges related volumes give us only a fraction of the number of transactions, we can also draw inferences from various indirect non-correlated channels that help us to map the number of users of the cryptocurrency.

It is indeed difficult to aggregate users from various wallets and come to an exact number that would be in line with the actual number of users in reality.Since Bitcoin is the type of cryptocurrency that operates and depends totally on the internet, we have created an analog to figure the Bitcoin activity basing on the search trends.Google trends gives us an estimate of the search interest as an index formed by the ratio of searches of a particular keyword or string as compared to its historical maximum.This tells us the general popularity of the keyword currently as compared to its popularity in the formative stages.The keyword that would most likely tell us or indirectly hint us towards Bitcoin adoption is the exchange price searches.The keyword ‘BTCUSD’ would be accessed regularly by people who are transacting or investing or have already invested in the cryptocurrency.Search trends reveal that the search interest index for this keyword has risen many fold indicating an exponential rise in the users of the cryptocurrency.

With the searches hitting a maximum in 2016, a simple trend line forecast shows that the users have doubled every year, depicting a meteoric rise in Bitcoin users.Bitcoin’s adoption rate parallel’s internet: Internet was first developed in its rudimentary form in late 1960s.It didn’t find institutional applications till 1980s.The real internet’s growth can be mapped from mid-1980s to mid-1990s, where closed facilities, institutes and few other companies have slowly adopted the technology amounting around 16 million users worldwide.In comparison, Bitcoin has already amassed over 12 million users in its birth decade and is going strong to beat internet’s adoption rate.Internet bloomed over the later part of the 1990’s after finding great number of applications.With IoT innovations coming up everyday, we can expect Bitcoin to pick up at the same pace and revolutionize Financial services and payments unequivocally.DISCLAIMER This research is not an offer to sell or the solicitation of an offer to buy any security in any jurisdiction where such an offer or solicitation would be illegal.

It does not constitute a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual clients.Clients should consider whether any advice or recommendation in this research is suitable for their particular circumstances and, if appropriate, seek professional advice, including tax advice.The price and value of investments referred to in this research and the income from them may fluctuate.Past performance is not a guide to future performance, future returns are not guaranteed, and a loss of original capital may occur.Fluctuations in exchange rates could have adverse effects on the value or price of, or income derived from, certain investments.Certain transactions, including those involving futures, options, and other derivatives, give rise to substantial risk and are not suitable for all investors.Supporting documentation will be supplied upon request.All research reports are disseminated and available to all clients simultaneously through electronic publication to our internal client websites.