Note: BitIRA does not currently offer Dash IRAs, though it may in the future. Currently, other crypto IRA types are available.
The ability to take full control of your retirement account and diversify with new and exciting assets whenever you choose is what makes self-directed IRAs so attractive. Adding cryptocurrencies to the mix can not only provide an excellent hedge to other assets, but also create an opportunity for substantial gains.
When a cryptocurrency gains exposure and shows particular promise, the team at BitIRA invariably looks at its pros and cons before deciding whether to offer it to our customers.
Although we do not yet offer a Dash IRA, we have kept an eye on the token for some time and watched it improve by leaps and bounds. What started as privacy-oriented coin similar to Bitcoin has since transitioned into a digital payments solution that is aiming to slowly but surely replace cash transactions by besting the top cryptocurrencies on fees and waiting times. But before we take a deeper look into the token, let’s first delve into self-directed IRAs (SDIRAs) and why they might be the right choice for your future.
What is an SDIRA?
Why should I choose it over conventional retirement accounts?
With a conventional IRA, a third party is in charge of managing your retirement portfolio. In addition to having little control over your investments, the number of assets available is also relatively restricted.
In contrast, SDIRAs allow retirement account holders to have full control over what goes into and out of their account, along with greatly expanding the diversification options. Whereas conventional IRAs are generally limited to stocks and bonds, the owner of an SDIRA has many more choices to pick from, not the least of which are cryptocurrencies.
Because of their benefits over conventional IRAs, SDIRAs have become the norm for a wide variety of retirement savers. Despite the option to expand your portfolio with many more assets, being an investment wizard is far from a prerequisite to having an SDIRA. Once you’ve made the choice to roll over into a digital IRA, our team will be ready to guide you through the entire process, from assisting with the paperwork to helping you understand your options to add to your account.
But what exactly can you hope to gain once you’ve opened a digital SDIRA? Some of the short-term and long-term benefits include:
- Merging existing retirement accounts: If you already have one or more retirement accounts, especially any sponsored by your employer, you can simply roll them over into your new digital SDIRA with minimal hassle—provided you fulfill eligibility requirements (we can help to check on that).
- Immediate control over your retirement savings: As soon as your digital IRA is up and running, you can be assured that your savings are handled and distributed entirely by you. The peace of mind in knowing that nobody is going to make ill-advised investment choices with your retirement money is often the primary motivation for moving into SDIRAs. Of course, should you wish to discuss current market trends in cryptocurrency or potential new inclusions into your account, our team is here to help.
- Deferring taxes on returns: Cryptocurrencies are known for their history of posting flashy gains, and these gains tend to attract the IRS’ attention. Within an SDIRA, however, you are free to acquire tokens at your leisure. So long as you adhere to regulations, any profits made from trading or holding tokens in your digital IRA will not be taxed until you take a distribution.
- Hedging stocks: In a conventional IRA, you have few options to protect your savings from losses in stock value. SDIRAs, however, offer unparalleled diversification and protection from crashes in a single market. Cryptocurrencies are a particularly attractive hedge, as they have little to no correlation with any other asset class.
- A greatly expanded variety of assets: Your ability to hedge against traditional equities extends far beyond cryptocurrencies. Within a digital SDIRA, you can diversify in a range of different asset classes, such as precious metals, real estate and partnerships. Plus, beyond the cryptocurrency you initially purchase for your digital IRA, you can add new tokens as they become available, be they existing stalwarts like Bitcoin and Ethereum or promising up-and-comers like Dash.
A primary reason why we have recently started to consider Dash for use within an IRA is its orientation towards a true digital currency. While all of the top cryptocurrencies started out under that definition, none have managed to avoid the persistent scalability issues that plague their respective markets.
As valuable as they have become, the most popular tokens have made few strides when it comes to transaction speeds and fees. The debate over whether coins should be treated as assets or currencies seems to have dwindled as scalability problems have, in many cases, made the use of cryptocurrencies for day-to-day payments impractical. The developers behind Dash are acutely aware of this, and they’re making an effort to finally deliver a decentralized digital currency for the masses.
What is Dash?
How is Dash different from the other top coins?
Although there are now over a thousand cryptocurrencies, the developers of each follow a basic premise: take an existing innovation (in this case, Bitcoin) and attempt to improve upon it. Dash is no different. When it first went live in 2014, its creators, Evan Duffield and Daniel Diaz, stated that the coin’s purpose is to offer the kind of privacy and anonymity that Bitcoin can’t.
The coin’s stated purpose was on solid footing. Bitcoin is praised for the anonymity it offers, and there’s no denying that a Bitcoin transaction is far more discreet than a wire transfer. Yet the underlying principle behind public ledgers creates its own set of privacy issues, which Dash (known as Darkcoin back then) tried to circumvent. The cornerstone of its appeal came from its cryptographic properties, which guaranteed untraceable transactions.
Yet as cryptocurrencies were launched into the mainstream, the crypto community grew less concerned about the potential privacy issues with existing coins, and more concerned with the lack of convenience. Taking note of this, Duffield began to steer his altcoin in a different direction, hoping to create a decentralized, wholly anonymous form of digital cash. In line with this, the coin was rebranded as Dash.
Dash’s speed of innovation
While Bitcoin and many other cryptocurrencies validate transactions through a process known as Proof of Work (which causes the aforementioned waiting times and hefty fees), Dash and its developers have instead opted for a customized version of the Proof of Stake (PoS) algorithm. And while they aren’t the only coin developer to turn to PoS over PoW for faster transactions, they have employed an entirely new concept in their efforts.
The Dash network operates through the use of Masternodes, which are run by individuals with a large-enough stake in the cryptocurrency. Instead of individual miners, “Masternoders” are in charge of validating transactions. Their stake in the network ensures compliance, and they get a reward for their work, which eliminates the need for end-users to pay excessive fees.
Despite the change of purpose, Dash and the team behind it have stayed true to their original intent. The cryptocurrency still uses the CoinJoin method of scrambling transactions to guarantee anonymity, while Masternoders are staked in a way that makes tampering highly unfeasible.
The future prospects of Dash
As the need for quick and anonymous digital transactions increases, the Dash team have done their best to meet demand. The Masternoding system has curbed transaction fees, the CoinJoin method has anonymized transactions and the Dash network has a circular verification method that makes it possible for payments to be approved in just over a second. Furthermore, Dash utilizes a unique funding method that ensures continued development of the coin without reliance on third-party benefactors.
These strong points have quickly established Dash as not only a top cryptocurrency, but perhaps the likeliest competitor to take the digital cash crown. The company has already cast its net outside the U.S. and is working with several emerging economies on establishing the token as a local method of exchange. On the domestic front, the coin is finding increasing acceptance among retailers and has netted an approval from Apple as a means of payment back in July 2017.
Opening your Digital IRA today
The ambitions and constant drive for improvement that the Dash team has shown have made the coin a difficult one to overlook. By subscribing to our newsletter, you’ll be the first to know if we’ve made the decision to offer a Dash IRA.
And, if you’re ready to open your digital IRA today, you can take a look at our current selection of cryptocurrency-based SDIRAs to see what each coin brings to the table and which one seems best suited for you.