Category: Superannuation

Categories
Australia Bitcoin Crypto News New Zealand Superannuation

Kiwi Fund Manager Sees Aussie Super Funds Holding Crypto Within Five Years

If your entire business model is centred on managing other people’s money and growing capital for the long term, bitcoin is becoming increasingly difficult for investment managers to ignore.

New Zealand’s KiwiSaver fund has invested around five percent of its money into bitcoin. The investment firm purchased bitcoin for the first time in October 2020 when it was trading at around US$10,000, meaning that KiwiSaver has already achieved substantial gains on its BTC holdings despite an almost 50 percent market dip from its all-time high of A$79,800 in April 2021.

KiwiSaver is basically the New Zealand equivalent of an Australian super fund, but with a more progressive charter. The fund is moving with the times by finding innovative ways to maximise returns for its New Zealand clients, and it recognises the long-term advantages of investing in bitcoin and other cryptocurrency assets.

Australian super funds could be next. KiwiSaver’s chief investment officer James Grigor says he expects competitors to follow suit over the next five years.

If you are happy to invest in gold, you can’t really discount bitcoin.

 James Grigor, KiwiSaver

Bitcoin Being Part of Every Super Fund Portfolio is Inevitable

The eventual adoption of bitcoin as a bread-and-butter asset in the typical retirement fund portfolio is inevitable. All that needs to happen is for the Australian Securities and Investments Commission (ASIC) to catch up and start offering a Bitcoin ETF.

If more exchange traded funds (ETFs) started investing in cryptocurrency, then super funds would likely end up holding underlying exposure to it. Australia’s first cryptocurrency ETF is pending and once the ETFs are launched, it will be far easier for investment managers to access crypto rather than having to go via an exchange.

Regulated ETFs will give investment managers the opportunity to buy at an institutional level, retail investors easy access to crypto via traditional equity platforms, and potentially have these ETFs included in broader funds and indexes as a standard part of an investor’s portfolio mix. Overnight, bitcoin can become an everyday asset in a super [fund]’s portfolio.

Byron Goldberg, country manager, Luno Australia

For now, self-managed super funds are the only means by which Australians can hold crypto as part of their superannuation. Until ASIC writes new rules around investing in crypto, the average Joe is left waiting with his future retirement savings invested in more old-school, less trendy investments, such as shares, gold and oil.

In the meantime, you can brush up on current rules for holding crypto in your super and read a Crypto News Australia comparison of five Australian super funds.

Categories
Australia Crime Crypto News Cryptocurrency Tax Superannuation

Australian Federal Taskforce Targets Crypto Fraud, Tax Avoidance

A multi-pronged taskforce that includes the Australian Tax Office (ATO), Federal Police, ASIC and the Australian Criminal Intelligence Commission (ACIC) is poised to investigate cryptocurrency transactions and their role in tax avoidance, fraud and money laundering.

The six-year-old SFCT (an acronym for the portentously named Serious Financial Crime Taskforce) claims responsibility for 40 current court cases involving individuals, along with 50 more operations it says are under investigation.

Focus On Money Laundering, Pandemic Stimulus Fraud and Misuse of Early Release Super Funds

Subjects of interest to the SFCT include the misuse of pandemic stimulus measures (such as JobKeeper), attempts to launder money via cryptocurrency, and fraud associated with last year’s early release of superannuation funds.

According to ATO deputy commissioner Will Day, who heads up the taskforce, “about 14” cryptocurrency exchanges are now sharing data with the SFCT.

Will Day, SFCT chief and ATO deputy commissioner

We’ve got a data matching program that we’ve had in place for a couple of years with digital currency exchanges … We are able to look at data matching to observe people’s spending habits, if they’re purchasing, say, luxury cars or real estate.

Will Day

In December 2018, the federal government injected $182 million in funding over four years to the ATO to extend its investigative brief. Also involved in SFCT activities are the federal Attorney-General’s department, the Commonwealth Director of Public Prosecutions, Border Force, and the Australian Transaction Reports and Analysis Centre.

Tax Time is Approaching in Australia

As tax time looms in Australia, the ATO is set to target Aussie crypto investors as they try to match data from crypto exchanges with taxpayers’ tax returns.

As well as investigating new crypto investors, the ATO may also target those who failed to declare their crypto holdings in previous years.

Categories
Crypto News Superannuation

10 Important Rules For Holding Crypto In Your Superannuation

10 Rules For Holding Crypto In Your Super
10 Rules For Holding Crypto In Your Super

Interest in Bitcoin, Ethereum and other cryptocurrencies is growing not only for trading and investing in the short term, but also for retirement fund managers and longer term investments.

Indeed, the number of superannuation accounts getting exposure to the cryptocurrency market as part of their portfolio is reportedly booming.

As the crypto market is still relatively new, it is essential to follow a few guidelines to ensure that your investments are compliant as well as set up correctly for long-term performance.

This guide lists 10 important rules you need to be aware of for holding cryptos in your super.

  1. You need a SMSF
  2. Meeting the sole-purpose test
  3. SMSF members take liability
  4. Accurate crypto reporting is necessary
  5. No borrowing, leveraging or shorting permitted
  6. Crypto loans are not allowed
  7. Privacy coins must be kept on the exchange at all times
  8. Staking coins are permitted with your SMSF
  9. Pension payments must be made in cash
  10. You cannot transfer cryptos into the SMSF

Need help? Speak with Cryptocurrency Superannuation Expert at NGS Crypto, call 1300 001 647, or Contact them via email

1. You need a SMSF

At the time of writing, the only type of retirement account that can include cryptocurrencies like Bitcoin is a Self-Managed Super Fund – SMSF in short.

There are a number of requirements any SMSF has to satisfy, regardless of the nature of its investment portfolio. For example, it needs a trust deed. Up to four trustees can be nominated in the SMSF – each of them must not be an employee of another fund member (unless they’re relatives). There are also ongoing costs for yearly tax returns, audits, financial statements and compliance. The ATO states that a SMSF can invest in cryptos, but the trust deed must allow such investment which must also be in accordance with fund’s investment strategy and other relevant regulations.

On the other hand, SMSF offer an investment structure with a fair degree of flexibility. You can hold any combination of certain assets including shares, precious metals, cash and (case in point) cryptos. One possible advantage of having cryptocurrencies as part of a retirement investment strategy is related to the tax savings it delivers. They can be indeed eligible for a 15% tax rate, possibly much lower than standard Capital Gains Tax rate. A bit of work to set up and manage a SMSF is necessary to hold cryptos in your super.

2. Meeting the sole-purpose test

In simple words, SMSF funds are dedicated only to retirement.

Compared to holding cryptos in your personal name, using a SMSF is an option for the long run, until you reach pension age. Therefore, only members who have met the required conditions can access the funds to receive super benefit payments. All SMSF have to comply with the Sole Purpose Test to be eligible for 15% tax rate previously mentioned.

This has at least a couple of implications:

  • Failing to comply with the sole purpose test will result at least in paying more taxes, potentially with civil and criminal penalties for fund members.
  • You cannot cash out your cryptos to benefit your current lifestyle while you’re still contributing to your super before retiring.

Don’t set up an SMSF to try to get early access to your super, or to buy a holiday home or artworks to decorate your house. These things are illegal.

Australian Taxation Office

You can read more about the sole purpose test on the ATO’s website.

3. SMSF members take liability

The difference between an SMSF and other types of funds is that the members of an SMSF are usually also the trustees. This means the members of the SMSF run it for their benefit and are responsible for complying with the super and tax laws.

Australian Tax Office

The liability of a Self-Managed Super Fund falls on its own members (hence the wording “Self-Managed”), abiding regulations from entities such as the ATO, SISA and SISR. The compliance relates to both the SMSF itself as well as its assets, including Bitcoin and other cryptocurrencies, no matter which third party is involved in preparing tax returns or advise on investment decisions.

The ATO is explicitly encouraging trustees “to seek independent professional advice before undertaking any new investment in their SMSF, including investments in cryptocurrencies.” ASIC’s MoneySmart website also has a page with “What to watch out for with cryptocurrencies and ICOs”. Make sure you do your due diligence in setting up and managing your SMSF.

4. Accurate crypto reporting is necessary

SMSF are tightly controlled and regulated. Consequently, it is mandatory to maintain precise administrative reporting and record-keeping. This applies to items like a bank account as well as cryptocurrencies.

As per ATO website, one application of this requirement is ensuring the assets are held by the SMSF with a clear separation in ownership and management from each member’s personal or business assets. In crypto terms, this means maintaining and being able to provide evidence of a dedicated wallet for the SMSF, separated from that used by trustees and members personally.

When it comes to cryptocurrency valuation, it has to reflect fair market value provided by a reputable exchange with publicly-available rates.

The value of cryptocurrency can change constantly. For the purpose of calculating member balances at 30 June, the ATO will accept the 30 June closing value published on the website of a cryptocurrency exchange that reports on historical cryptocurrency values.

Australian Taxation Office

5. No borrowing, leveraging or shorting permitted

You cannot borrow, leverage or short any assets within the SMSF. That is because the whole point of a SMSF is to provide funds for retirement and not improving the current lifestyle of its members (see sole-purpose test).

It is unlikely that an SMSF will meet the sole-purpose test if trustees or members, directly or indirectly, obtain a financial benefit when making investment decisions and arrangements. For example, it may be a breach of the sole-purpose test where affiliate fees or commissions associated with the fund’s cryptocurrency investment are paid to a trustee or member personally.

Australian Taxation Office

6. Crypto loans are not allowed

Using the crypto in the SMSF as collateral to secure other loans is not permitted either. The reason is the same as for the previous point: using SMSF funds to benefit in the present rather than after retirement is beyond its “sole-purpose” nature and thus not allowed.

7. Privacy coins must be kept on the exchange at all times

SMSFs are frequently audited and auditors must be able to assess the investment portfolio.

Looking at the crypto portfolio component being held, any privacy coins have to be kept on the exchange as this allows the auditor to perform their duty. It would be otherwise impossible for the auditor to verify their location and SMSF would likely fail the audit.

8. Staking coins are permitted with your SMSF

Yes, it is possible for SMSF to stake coins and gain an interest as long as the purpose of this is to accrue value to be used for retirement (thus meeting the sole-purpose test) and it is permitted by the trust deed and other relevant regulation.

The interest of course would have to stay within the SMSF and not distributed to its members until they meet release conditions. Additional tax and fees may apply, specifically about the tracking, reporting and auditing of the interest component.

9. Pension payments must be made in cash

Where a trustee or member satisfies a condition of release, the SMSF can make an in specie lump sum payment by way of transfer of cryptocurrency. However, pension payments must be made in cash.

Australian Taxation Office

This practically means that you will have your SMSF paying you in cash when you will retire, whether your SMSF holds cryptos or not. It might be possible for you to transfer an amount of cryptos to your personal wallet as a one-off without converting into AUD. There are a couple of important points to consider:

  • The SMSF trust deed has to allow such kind of transfer.
  • Changing ownership of an asset is a CGT event, thus transferring cryptos from a SMSF wallet into one of its members wallet might result expensive tax-wise.

10. You cannot transfer cryptos into the SMSF

Bitcoin and other cryptocurrencies are not considered listed securities. This impacts how SMSFs can go about acquiring crypto assets.

With certain exceptions, SMSFs are prohibited from intentionally acquiring assets from related parties. The exceptions include listed securities and business real property, when acquired at market value. Cryptocurrencies such as bitcoin are not ‘listed securities’ so do not fall within the exceptions. They therefore cannot be acquired from a related party.

Australian Taxation Office

SMSF trustees and members are indeed related parties of the SMSF itself. Therefore, if you want to have cryptos in your SMSF, you have to purchase them from the SMSF and not transfer from your personal wallet. When you retire you might be able to transfer them back as cryptos from your SMSF to you though, assuming you meet the requirements as mentioned previously.

Conclusions

Using a Self-Managed Super Fund to expose your retirement investment portfolio to the cryptocurrency market is definitely possible, allowing you to to legally buy Bitcoin using your super. There are advantages and disadvantages of a crypto-focused superannuation that are worth considering, as well as the rules mentioned in this guide.

Like any investment, there is a degree of risk involved therefore do your own research and due diligence before committing to it. You might want to consider engaging third-party expert consultants to ask for professional advice tailored to your circumstances.

Need help? Speak with Cryptocurrency Superannuation Expert at NGS Crypto, call 1300 001 647, or Contact them via email

Categories
Bitcoin Superannuation

Comparing 5 Bitcoin Super Funds in Australia

Whilst the rise of Bitcoin may be one of the world’s worst kept secrets, its evolution into a genuine asset group has opened up investment opportunities for people from all walks of life.

In 2014, the Australian Taxation Office (ATO) acknowledged the rise of Bitcoin and other cryptocurrencies not as a currency, but as a capital gain asset, taxable at a rate of only 15%.

This then opened the door for owners of self-managed super funds (SMSF) to invest and transact in cryptocurrency. Now, many companies offer their services to those looking to set up an SMSF by assisting with things like accounting admin, tax returns and audits.

So, if you’re thinking of diversifying your superannuation portfolio by getting on board the crypto bandwagon, but you’re not quite sure which way to turn, this article is for you.

We’re going to take a closer look at five platforms that allow you to hold your cryptocurrency and perform trading with your superannuation funds and give you the lowdown on the pros and cons of each of them.

Important to note: Some of these platforms such as Binance and Swyftx just allow you to have dedicated accounts for your super. But they don’t help you set up the SMSF and they do not do the administration of the fund.

4. NGS Crypto Dedicated Account For Your Super Fund

Nextgen Systems (NGS Crypto) is an international blockchain mining company which delivers the best fusion of encrypted currency investing. Unlike the other crypto platforms, NGS Crypto provides a digital asset mining service which means you don’t have to be a blockchain expert to invest in cryptocurrencies with them.

NGS supports the use of SMSFs to trade in crypto and offers a $0 up-front fee to transfer your superannuation across, potentially saving thousands of dollars. With NGS, all returns are paid daily in Bitcoin and after securing an affiliate partnership with one of Australia’s biggest financial wealth analyst companies, you will also have access to sound financial advice.

Need help? Speak with Cryptocurrency Superannuation Expert at NGS Crypto, call 1300 001 647, or Contact them via email

3. Swyftx Dedicated Account For Your Super Fund

Swyftx prides itself on being Australia’s most progressive cryptocurrency exchange platform. Swyftx burst onto the scene in 2017 and now has over 60,000 users taking advantage of their low fees and non-inflated market prices.

Swyftx now allows SMSF eligible investors to use its exchange platform and trade in up to 200 cryptocurrencies including Bitcoin and Ethereum as well as stable currency like USD coin.

4. Binance Dedicated Account For Your Super Fund

Binance is the world’s largest crypto exchange and through creating a corporate Binance Australia account, you can trade cryptocurrency as an SMSF. 

Because of the company’s size, setting up an SMSF with Binance gives you huge flexibility, with access to trading in more than 740 cryptocurrencies.

Binance also has a helpful set of basic Super outlines that will help show you how to set up an SMSF in the absence of a third party consultancy firm.

5. BTC Markets Dedicated Account For Your Super Fund

BTC Markets are Australia’s largest and most trusted digital asset exchange and their platform supports SMSF investment. Despite having a smaller selection of cryptocurrencies to trade in, BTC offers great liquidity across markets including Bitcoin, Ethereum and XRP. 

Since being founded in 2013, the Australian owned and operated company has been at the centre of the crypto boom, with over $10.5 billion AUD traded on the platform in that time. 

BTC also offers a helpful KPMG tax reporting feature for annual audit preparation and a personalised service for larger trades.

Choosing your Bitcoin Super Fund

In summary, the nature of the ATO’s stance on cryptocurrency means that Australia provides a somewhat lucrative haven for those seeking exposure to Bitcoin and other digital assets.

By setting up a SMSF or moving an existing superannuation fund over to an SMSF perhaps with a third party platform, Australians can take advantage of the current low tax rates for SMSFs. 

Owners of an SMSF can then trade in crypto across platforms like Binance, Swyftx or BTC or use mining experts NGS Crypto and diversify their portfolio ahead of what will hopefully be a fruitful retirement.

Categories
Superannuation

Is it Legal to Buy Bitcoin with your Super?

In this article, we’re going to take a look at the legal issues around owning Bitcoin and Cryptocurrencies in your Australian Superannuation.

We’ve teamed up with Australian expert accountants and lawyers to bring you the latest expert information and validated opinions. Please don’t use this information as point of truth, check with the experts for the latest information, as everyone may have different circumstances.

Must read: Take a look at our article covering the Advantages of having crypto in your Superannuation which could help you further understand the pros and cons.

What is the ATO’s Current Laws on Crypto Super Investing?

  • Yes you can own bitcoin and other cryptocurrency in an SMSF.
  • Bitcoin and other cryptocurrencies are treated as capital gains tax assets.
  • Cryptocurrencies held in an SMSF must be allowed for under the fund’s trust deed.
  • Owning cryptocurrencies in an SMSF must be done so in accordance with the fund’s investment strategy.
  • Purchases must comply with SISA and SISR regulatory requirements concerning investment restrictions.
  • An SMSF’s cryptocurrency investments must be held and managed separately from the personal or business investments of trustees and members.

The Requirements to Buy Crypto with Your Super

ATO requirements consideration when establishing your fund and keeps abreast of any ATO changes as time goes on. See the 10 Step Checklist to setting up your SMSF with detailed information on the process.

Is an SMSF required or can Super Funds Buy Crypto on your behalf?

Currently an SMSF is the only way to gain exposure to the crypto space with your superannuation. Any asset purchased by retail or industry superannuation funds (such as Suncorp Super, Australian Super, CBUS Super, QSuper, ANZ and others) needs to be listed on their approved product lists. Retail superannuation funds cannot invest in bitcoin or other cryptocurrencies directly but will be able to invest indirectly into cryptocurrencies through listed ETFs or other regulated crypto products once they are approved by regulatory bodies.

Which Cryptocurrencies are legal to buy with your Super?

All cryptocurrencies are permitted. by the ATO provided the reporting is carried out correctly. You need to confirm with your accountant as to whether they can obtain the required information to complete the work (via appropriate reporting) and whether your auditors can verify the existence and value of the coins to their satisfaction.

Accountants and auditors are generally unable to verify the reports or existence or value of coins purchased on DeFi platforms or overseas exchanges. If your accountant or auditor cannot complete their work satisfactorily your SMSF may fail to complete its annual reporting obligations and your fund may become non-compliant. For this reason, if you are not 100% sure, double check with your accountant regarding the exchange and coins you wish to own before making any purchases.

An approved providers list where you are permitted to purchase any coin that is listed on an approved exchange.

An SMSF’s investment strategy outlines its investment objectives and specifies the types of investments it can make. Before investing in cryptocurrency, SMSF trustees and members should consider the level of risk of the investment. Trustees and members may then review and if necessary, update their fund’s investment strategy to ensure the investment being considered is permitted.

ATO – Investment strategy and a fund’s governing rules

Whats the Minimum Super Balance Required?

There is no legal minimum balance you need to have an SMSF, it just needs to make sense to you in your situation.

The cost to run an SMSF is static, meaning it costs the same regardless of how much you have in you super. This is different to retail funds where you will pay on average of 1-1.5% of the value of your super in fees each year. Eventually it gets to the stage where you are crazy not to have an SMSF because it is cheaper, but after you do the sums, even if you find an SMSF more expensive for now, many people are happy to pay an extra few hundred dollars a year to be exposed to assets (like bitcoin) that they you would not otherwise be able to be exposed to in their superannuation.

Some experts suggest that you need a high amount in your super if you wish to invest with a SMSF. This simply is not true, “hundreds of clients have started their SMSF with under 50k and they were happy to pay an extra few hundred dollars a year in accounting fees compared to their retail fund so that they could own other assets like bitcoin.”.

Will the Australian Government Ban Buying Crypto with Super?

As it’s a fairly new market, the future of cryptocurrencies is still uncertain. However, there has been no indications so far that Crypto will be banned in Australia.

The fact that listed companies in the USA like Tesla and Microstrategy are holding bitcoin on their balance sheet and that Goldman Sachs is reopening its institutional cryptocurrency trading desk legitimises the space. This is because these companies would not risk shareholder equity in an asset if there was uncertainty regarding the government’s stance on cryptocurrencies. Australia will more than likely follow USA’s lead here and keep cryptocurrencies as a legal form of property.

Conclusions

If you want to hold bitcoin or other cryptocurrencies in your super, currently an SMSF is your only option. The main consideration is to decide whether an SMSF is right for you. This is a personal consideration and is different for everyone.

Need help? Speak with Cryptocurrency Superannuation Expert at NGS Crypto, call 1300 001 647, or Contact them via email

Categories
Australia Bitcoin Crypto News New Brighton Capital Superannuation

Australian SMSFs are Buying More Bitcoin Despite Increase in Price

Australian SMSFs are Buying More Bitcoin Despite Increase in Price

A report by the Australian Financial Review on Wednesday confirmed the growing interest in Bitcoin among retirees in Australia. Self-managed super funds or SMSFs are increasingly accumulating more Bitcoins for clients, not minding the increased market value of the cryptocurrency.

On Wednesday, the price of the leading digital currency, Bitcoin (BTC), soared to another record level of over US$51,100. This indicates that retirees in the country are more confident with allocating their funds to the cryptocurrency.

A Five-fold Increase in 2020

Last year, the Bitcoin purchases of self-managed super funds increased by five-folds, according to BTC Market, the largest cryptocurrency exchange in Australia. The average crypto trade amongst these funds also spiked by 20 percent within the last quarter of the year, as Bitcoin began seeing more institutional and corporate investors, like MicroStrategy, MassMutual, Square Inc., and many others. 

“Previously trade sizes for SMSFs were in the tens of thousands of dollars, but we’re now seeing in the hundreds of thousands of dollars,” according to Caroline Bowler, the chief executive at BTC Markets. This is probably because many Australian retirees now prefer the cryptocurrency to gold as a better asset to hedge against the declining value of fiat currencies, the report reads.

“Bitcoin as a store of value is interesting to SMSFs holders. People are researching it and getting better educated around it. They look at it as a deflationary asset, and I think they understand the concept behind that,” Bowler added. 

Interested in buying crypto with your Super? Need help? Speak with Cryptocurrency Superannuation Expert at New Brighton Capital Book a Free 20 min Consultation

Only 21 Million Bitcoin Will Ever Exist

Fiat currencies like the British Pounds and Australian dollar are issued and controlled by the government and the central bank of the nation. There is no limit to the number of currencies these authorities can issue. However, Bitcoin is pre-programmed to cap at 21 million; nothing more, nothing less. This supports the idea that the cryptocurrency can serve as an inflation hedge asset. As of February 17, there was over 18.6 million BTC in circulation. 

Categories
New Brighton Capital Superannuation

5 Advantages and Disadvantages of a Crypto Focused Superannuation

In this article, we’ll take a look at the Australian Pros and Cons of having Bitcoin and Cryptocurrency in your Superannuation.

We’ve spoken to the experts in Crypto Super at New Brighton Capital to help us produce this content for you.

Recently, we also took a closer look at the suitable cryptos for your super portfolio and why they might be good candidates considering Price Stability, Longevity, Robustness and Moat/Competition.

Disadvantages

  1. Risk – performance. New Brighton Capital does not provide financial advice. Our bread and butter client has a good idea of where they want to invest their super and we provide the tools and know how so you can invest your super how you see fit, whether that be in Bitcoin Ethereum or BPH and Tesla. The ATO does not require you to have a certain level of performance with your SMSF but you need to realise that the buck does stop with you regarding the performance of your fund. So as long as you are comfortable making the investment decisions and being in the driver’s seat, then an SMSF might be a good option for you. 
  2. Responsibility – Self managed super funds do carry a lot of responsibility regarding compliance and reporting obligations. NBC becomes what is called the administrator for your fund. So while you are ultimately responsible for the running of your fund, you outsource the administrative work to us. So we look after the compliance and reporting etc so you can focus on managing your portfolio. 
  3. Cost – The cost to run an SMSF is static, meaning it costs the same regardless of how much you have in you super. This is different to retail funds where you will pay on average of 1-1.5% of the value of your super in fees each year. Eventually it gets to the stage where you are crazy not to have an SMSF, but after you do the sums, even if you find an SMSF more expensive for now, many clients are happy to pay an extra few hundred dollars a year to be exposed to assets that they you would not otherwise be able to be exposed to in their superannuation, like Bitcoin. There is no legal minimum balance you need to have an SMSF, it just needs to make sense to you in your situation. 
  4. Time – active or inactive as you wish. NBC has integrated with Australia major exchanges to cut the time you spend to prepare your annual reporting to minutes, not hours. It takes our average client under 30 minutes a year to provide the information we need to complete the reporting requirements for your SMSF.
  5. Security – Specifically relating to cryptocurrency, SMSFs can keep their coins on exchanges or transfer coins to their own hardware wallet where you control the private keys. New Brighton Capital will never ask for your seed phrase or private keys so make sure you never give these to anyone, ever. We will, however, require the public addresses of where your SMSF off exchange crypto holdings are so we can verify their existence and complete the reporting for your fund. Clients of New Brighton Capital also have access to a secure encrypted online portal which you can think of as your online filing cabinet for your SMSF. This is where we communicate with you and you upload your information for the reporting etc.

Advantages

  1. Choice – Vastly more options with an SMSF compared to a retail superannuation fund. Clients can purchase any cryptocurrency listed on any of our approved providers. Clients are not just limited to cryptocurrencies, you can also invest in shares (local and abroad), real estate, art or anything permitted under the superannuation laws. While New Brighton Capital cannot tell you where to invest we can definitely let you know whether you are permitted to invest in a certain asset or what you options might be.
  2. Control – With New Brighton Capital, You are the only one in control of your SMSF bank account, your trading accounts and your assets.  Noone controls your money or your assets but you.
  3. Cost – As explained in the disadvantages, the cost to run an SMSF is generally fixed regardless of how much you have in your super. So there comes a point where you are crazy not to have an SMSF because it is simply cheaper.
  4. Front run institutional money – Rarely does the retail investor have an advantage over institutions like the banks or Wall St. For over a decade retail investors have had the advantage over institutional investors in the crypto space because due to on ramps and legislation. This window is closing fast as institutions now have the on ramps and legislative clarity to participate in cryptocurrency space.
  5. Flexible – You do not have to transfer all your superannuation money into an SMSF if you set one up. You can kick it off with a partial transfer and transfer more funds into the SMSF down the track. So, yes you can have a retail superannuation fund and an SMSF at the same time. You are also not tied to your SMSF, so you can wind it down and move back to a retail fund if you wish in the future.

Need help? Speak with Cryptocurrency Superannuation Expert at NGS Crypto, call 1300 001 647, or Contact them via email

Categories
Superannuation

10 Cryptos Suitable for your Superannuation Portfolio

Today we are discussing the Top 10 Cryptocurrencies worth considering for an Australian Superannuation Portfolio.

A quick heads up that this is not financial advice, please do your own research and speak to an expert if you need help.

Many superannuation experts suggest the importance of diversification in your Superannuation portfolio, stating that “diversification lowers risk”.

Across asset classes, it reduces a portfolio’s exposure to the risks of any one class. It cannot eliminate the risk of loss, but it can help to protect against unnecessarily large losses resulting from the underperformance of one portion of the portfolio. Undiversified portfolios also have greater potential to suffer catastrophic losses.

Vanguard Super – Over $146 Billion in Assets under management

Bitcoin and other cryptocurrencies can potentially contribute to such diversification from 2021. That seems to be confirmed by Fidelity, a company that offers Institutional solutions for digital assists confirm in their Bitcoin Investment Thesis that Bitcoins Volatility Is Worth It and Recommends Investing up to 5% of Ones Portfolio. That being said, let’s take a look at the characteristics of crypto required to be considered for your Super, and the top 10 candidates.

Key Crypto Characteristics for Superannuation

  1. Price Stability – Is the dollar price stable enough to reduce big portfolio value fluctuations?
  2. Longevity – How long has the crypto been around and does it have a future?
  3. Robustness – Has the crypto proven ability to withstand or overcome adverse conditions in the market?
  4. Moat – Which advantages and protections does the crypto have against the competition?

1. Bitcoin (BTC)

Bitcoin is a peer-to-peer online currency, meaning that all transactions happen directly between equal, independent network participants, without the need for any intermediary to permit or facilitate them.

Why Bitcoin is suitable for Superannuation

  • Bitcoin is the oldest crypto (13 years) and has the biggest marketcap, as this grows, the price volatility is expected to reduce over time.
  • Bitcoin’s fundamentals are relatively shielded from the economic impact of the COVID-19 pandemic, and as Gold did, it also thrived during this period, enhancing its prospects of a being a hedge.
  • Bitcoin is also unique in that it continues to be influenced by retail investor sentiment and can capitalize on the shift in the way retail investors interact with traditional markets.
  • The popularity of Bitcoin with millennials and the expected transfer of wealth to the millennial generation over the next 10 years, which some could flow into Bitcoin and crypto.
  • Bitcoin has a fixed supply of 21 million Bitcoins.
  • Many attempts to clone and overtake BTC have failed (hard forks such as BCH, BSV etc) enhancing its robustness value.

2. Ethereum (ETH)

Ethereum is a decentralized open-source blockchain system that features its own cryptocurrency, Ether. ETH works as a platform for numerous other cryptocurrencies, as well as for the execution of decentralized smart contracts.

Why Ethereum is suitable for Superannuation

3. Litecoin (LTC)

Litecoin is a cryptocurrency that was designed to provide fast, secure and low-cost payments by leveraging the unique properties of blockchain technology.

Why Litecoin is suitable for Superannuation

  • Its close relationship to Bitcoin and its digital scarcity make Litecoin especially valuable. On-chain activity shows a healthy Litecoin network that has over 100,000 active addresses, and is processing roughly 40,000 transactions every 24 hours.
  • Where BTC lacks some value in making transactions, due to the fluctuating transaction fees, LTC is particularly useful with almost zero transaction fees.
  • Litecoin’s code is very similar to Bitcoin’s and includes both a fixed supply and an LTC block reward halving like Bitcoin

4. Chainlink (LINK)

Chainlink is a decentralized oracle network which aims to connect smart contracts with data from the real world. Chainlink has the potential to connect smart contracts with the outside world.

Why Chainlink is suitable for Superannuation

  • Chainlink provides the connection between real world data and the virtual blockchain data. This unique use case makes it extremely powerful to blockchain, enhancing its longevity prospects.
  • Decentralized blockchains are using Chainlink services to power DeFi projects using Chainlink’s decentralized oracle network, enhancing the projects usefulness ten fold.
  • Chainlink continues to partner with hundreds of companies growing their ecosystem.

5. Binance Coin (BNB)

Binance Coin is the cryptocurrency of the Binance platform. It is a trading platform exclusively for cryptocurrencies. The platform achieved an enormous success within a very short time and is focused on worldwide market.

Why Binance Coin is suitable for Superannuation

  • Binance has expanded worldwide including into Australia in 2020.
  • Over recent years, Binance has acquired many high profile businesses such as Coinmarketcap and Blockfolio.
  • BNB has utility in trading (reducing the trading fees) which is an expanding market as more people and institutions start trading cryptos the use of BNB for staking and trading will increase.
  • The strong brand, enhanced trading software and great management team of Binance is helping it grow exponentially.

6. Maker (MKR)

Maker is the governance token of the MakerDAO and Maker Protocol — respectively a decentralized organization and a software platform, both based on the Ethereum blockchain — that allows users to issue and manage the DAI stablecoin.

Why Maker is suitable for Superannuation

  • The future of Maker looks good. The team has delivered on its promise of forming a strong, decentralized stablecoin ecosystem.
  • Being a decentralized organization helps its prospects of longevity should cryptos be banned by countries or governments.
  • A stablecoin is a token (like Bitcoin and Ethereum) that exists on a blockchain, but unlike Bitcoin or Ethereum, Dai has no volatility. It’s instead created/destroyed in response to DAI price fluctuations in order to keep it hovering around $1 USD. This function could prove extremely useful for the future of stablecoins.

7. Compound (COMP)

Compound is a DeFi lending protocol that allows users to earn interest on their cryptocurrencies by depositing them into one of several pools supported by the platform.

Why Compound is suitable for Superannuation

  • Compound introduces a truly open lending environment to the blockchain sector. There are no credit checks and the funds issue immediately, just needing to provide collateral. With the growing interest in DeFi, puts COMP in a promising position.
  • Compound is managed by a decentralized community of COMP token-holders and their delegates, who propose and vote on upgrades to the protocol, enhancing its longevity prospects.

8. Basic Attention Token (BAT)

Basic Attention Token is the token that powers a new blockchain-based digital advertising platform designed to fairly reward users for their attention, while providing advertisers with a better return on their ad spend.

Why Basic Attention Token is suitable for Superannuation

  • The digital marketing industry represents one of the most important and valuable sectors in the world. The BAT token is a leader in this sector and offers a free market where anonymous participants can share value. Advertisers can better target their users and the users will be paid for watching what they are interested in. Similarly, publishers will receive BAT rewards based on the user attention they received.

9. Polkadot (DOT)

Polkadot is an open-source sharding multichain protocol that facilitates the cross-chain transfer of any data or asset types, not just tokens, thereby making a wide range of blockchains interoperable with each other.

Why Polkadot is suitable for Superannuation

  • Scalability has always been an issue (just look at the limits of VISA). Polkadot is attempting to solve this problem by providing limitless Scalability between public and private blockchains. Enhancing its longevity as an essential supporting technology.
  • Polkadot can support upgrades, without having to resort to drastic hard forks to implement change, enhancing its robustness value.
  • Many decentralised projects utilize Polkadot for its hybrid consensus models, staking mechanisms, and state-transition function. Utility to DeFi projects enhances its utility.

10. Synthetix (SNX)

Synthetix is based in Australia, and provides a liquidity protocol for derivatives trading in DeFi, allowing anyone, anywhere to gain on-chain exposure to a vast range of assets.

Why Synthetix is suitable for Superannuation

  • We’ve included Synthetix as a candidate, as it offers some Australian exposure into the crypto portfolio.
  • It also has promise in the decentralised trading, staking and loans space, offering a very complex protocol built on Ethereum, moving towards a censorship-resistant, decentralised governance solution.

Bonus Consideration: Binance Leveraged Tokens

Self managed super funds are not permitted to have debt. This means that leverage and margin trading are not allowed. You are, however, permitted to own assets or products where there is leverage within the product but no debt to you, the purchaser.

Binance Leveraged tokens are an example of this because the purchaser is not taking on debt but the price of the leveraged token moves up and down a multiple of the underlying asset. These tokens are available for many of the top cryptos and are similar to leveraged ETFs on the stock market. The SPXL for example is an ETF designed to move 3 times as much as the S&P 500. So if the S&P 500 moves up 2% the SPXL can be expected to move up about 6%.

It is important to understand that although products like these can magnify your profits they also magnify your losses if the market moves against you.

Conclusion

With over 8,000 coins and tokens on the market now, it is essential to know which ones are actually useful and have a future, and those that clearly have no long term future.

Categories
New Brighton Capital Superannuation

New Brighton Capital Partners with Swyftx to Provide 200+ Cryptos For SMSF’s

New Brighton Capital recently announced a Partnership with Australian cryptocurrency exchange Swyftx to provide access to Bitcoin and over 200 cryptocurrencies for Self Managed Super Funds.

Crypto currencies and blockchain assets represent a quantum leap in political and economic freedom for the world. By extension, this space offers the greatest investment opportunities of our generation.

Michael White – Founder/CEO New Brighton Capital

New Brighton Capital CEO, investor and long time crypto fanatic Mike White, explains how crypto enthusiasts can now hold bitcoin and other cryptocurrencies in their superannuation.

Need help? Speak with Cryptocurrency Superannuation Expert at New Brighton Capital Book a Free 20 min Consultation

New SMSF $250 Free Credit

For those without an SMSF, Swyftx is offering $250 FREE account credit to clients who set up a new self-managed super fund with New Brighton Capital and use coupon code “SWYFTX” on the application.

About New Brighton Capital

New Brighton Capital logo

New Brighton Capital is an Australian based company providing professional services to own Cryptocurrencies in your SMSF. You can own Bitcoin and other assets in your own superannuation through approved providers – Australian Banks and Australian Crypto Exchanges. NBC & Partners handle all the compliance, tax returns, audits etc so you can concentrate on managing your investments and building your portfolio.

About Swyftx

Swyftx is an AUSTRAC registered Australian crypto currency exchange & trading platform. Buy, Sell & Trade over 100 Crypto-Assets on Australia’s most progressive Cryptocurrency Exchange.

How to get Started?

There are a few considerations before deciding to buy Cryptos in your Superannuation. There are also some useful FAQ’s you can read which may help.

For more information relating to SMSFs contact NBC on 1300 264 022 or email [email protected].

Categories
Binance Crypto News Institutions Superannuation

Binance Australia Sees Corporate Users Grow by 400% Since Last Quarter

Binance Australia has seen their SMSF and corporate user base grow by over 400% compared to the previous quarter, end of 2020. This news was reported directly from Binance Australia to Crypto News.

With the previous significant rally in 2017, the public perception of crypto was very different to what we’re seeing more recently. There has been far bigger growth this time around, but not with quite the same level of noise in the mainstream that we experienced in 2017 suggesting much of the investment in the last few months has been institutional.

Binance Australia’s CEO, Jeff Yew

Users can register a Corporate account on Binance Australia (also known as an “Enterprise Account”) through a new account or by turning their existing personal account into an enterprise account.

Presently, setting up a corporate account can be a lengthy process, however, that seems to be the case with all legitimate crypto exchanges operating worldwide and in Australia. They are subject to Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) rules as well as required to be compliant with all applicable laws, like any other registered financial institution and digital currency exchange in Australia.

2021 is Looking Promising for Binance Australia

This news also follows other recent uptakes with Binance AUD Trading Volume Over A$130 Million In a Single Day. Users can now do PayID/Osko Australian Dollar (AUD) deposits with zero fees directly from their Australian bank accounts.

Jeff Yew (Binance Australia’s CEO) also mentioned that they are seeing cryptos as an asset class and technology that is better understood, and far better appreciated in 2021, with the recent sustained bull run is supporting this. As the retail demand for crypto assets continues to grow, he believes they will continue to see this increase in institutional adoption of Bitcoin, likely to lead to a supply squeeze of the asset.