Ripple IRAs, An Alternative Retirement Investment
When most investors hear “cryptocurrencies,” they think “Bitcoin.” But, there are other digital currencies, each with its own token, exchange method and support technology.
Ripple IRAs are self-directed individual retirement accounts that use the Ripple digital currency. With this account, you can purchase an asset other than the stocks, bonds and mutual funds, which are the options normally offered in a conventional IRA.
Ripple, Ripples and XRP
Ripple is the umbrella term that people (sometimes incorrectly) use to describe a payment method, a technology and a digital currency. Let’s clear the confusion with a few definitions:
- Ripple is a payment network that uses a digital currency to send money around the world. The network is designed to speed up money transfer and cut the costs of financial transactions. This totally electronic transfer uses a public database that enables users to make payments and exchanges with a specified process.
- Ripple is also a company, which builds and promotes products based on the Ripples technology.
- Ripples technology enables transactions on the Ripple network. The technology includes distributed open source software, a ledger and a cryptocurrency.
- XRP is a cryptocurrency. Also known as the Ripple coin or token, XRP is used for payment, remittance and currency exchange in the Ripple network.
Different than Bitcoin
There are many differences between Bitcoin and XRP. But, if you are comparing XRP and Bitcoin investments, you need to know that:
- They have different users and uses.
Bitcoin is used by individuals and organizations as virtual currency. Ripple is used to transfer and exchange currencies by banks and other financial institutions.
- They use different methods to complete and validate transactions.
Ripple completes these tasks more quickly than Bitcoin—to the tune of four seconds versus five minutes.
- They have different ways of exchanging currency.
Unlike Bitcoin, the Ripple currency exchange network completes exchanges without a third party. Fewer parties translate into simpler, faster, and cheaper transactions.
- Ripples software supports automated scripts.
Ripples software can set up complex transaction scenarios and process them automatically. This approach eliminates delays of running the transfers manually. The result: faster, lower cost-transactions for Ripple customers.
Ripple IRA Investments
Although some merchants already accept various cryptocurrencies as a form of payment, this digital asset class is still new and uncharted territory. The tremendous potential for more widespread use and acceptance of XRP make Ripple-based investments worth a look.
If you are interested in long-term Ripple investments, you might want to consider Ripple IRAs. This retirement account is based on Ripples technology. Its blockchain solution has the speed and efficiency that some analysts claim can make major changes in the international banking system.
What Makes Ripple IRAs Worth Considering as an Investment
Several finance principles—benefits and business value—can help you decide whether an IRA based on XRP has a place in your retirement portfolio.
Ripple IRA Benefits
Owning a Ripple IRA provides immediate financial advantages, which include:
- Tax-deferred returns. If you qualify for tax deferral, you can maximize your investments in a tax deferred IRA account. This means that you can buy and sell Ripple, or hold it as a long-term investment, with any gains being non-taxable until distributions are made, provided that all rules and regulations are followed.
- Protection against losses in stock value. By investing in XRP, you are diversifying beyond many of the conventional IRA assets, which mostly correlate with the value of the stock market. Cryptocurrency investing a brand new and complex world, so it’s important for you to understand the pros and cons of using XRP for such purposes.
Some Ripple IRA investors believe that they may receive the most tax benefits by purchasing Ripple for a Roth IRA. See why here:
IRA Value: More than Short-Term Benefits
Short-term financial benefits are just part of a Ripple IRA’s value. To get the full story, let’s look to the future. That’s where the long-term opportunity–and potential growth in value–lie. Here’s what Ripple (the company) is doing to establish and sustain XRP demand and value.
- Established a carefully targeted audience in a stable niche market.
- Developed capabilities that appeal to big-name banks and well-known payment providers. Ripple designed their exchange network to cut the resources used in cross-border financial transactions. Fewer process steps, fewer entities involved in transfers—anything that simplifies and speeds up the exchange process dramatically reduces the time and cost of moving money worldwide. These lower operating costs make XRP a very attractive currency.
- Developed capabilities more efficient than the competition. Ripple performance surpasses Bitcoin in terms of speed, scalability, security, and lower operations costs.
- Engages in a long-term strategy of increased XRP acceptance and adoption. Ripple nurtures XRP adoption to stimulate demand. The XRP value increase of early 2018 is connected directly to the company forging partnerships that increase use of its XRP token. Here are just some of the partnerships Ripple has formed in 2018:
- Mar 18, 2018: Ripple announced that FLEETCOR, an international commercial payments provider, is launching a pilot program to use XRP in payment flows through Ripple’s xRapid.
- Feb 21, 2018: Ripple adoption continues with five new high-profile partnerships announced in emerging markets: two banks (in Brazil and India) and three remittance providers (in Singapore, Brazil, and Canada).
- Feb 10, 2018: UAE Exchange, a leading international payment solutions company, has joined the RippleNet enterprise blockchain network to enable expedited and easy cross-border payments.
Add 21st Century Finance and Technology to Your IRA
A Ripple IRA is a great way to participate in this exciting new currency market. You can find more information about setting up a secure cryptocurrency-based IRA here. If you have questions about Ripple, XRP or qualifying for IRA-based tax deferrals, contact us today at (800) 299-1567 to get started.