SMSF’s and Crypto-currency
Self-Managed-Super-Funds are permitted to own crypto-currencies with the case for holding crypto-currencies within an SMSF as follows:
- They are liquid assets with a deeply supported market of sufficient capitalisation
- They offer diversification benefits with respect to all other asset classes such as bonds, cash, equities and property
- They are not subject to sovereign default risk
- They offer asset protection equivalent to gold and other precious metals
- They are priced across multiple currencies and thus hedged internationally
- They are arguably more suitable than many Personal Use assets (some of which are highly illiquid)
Crypto-currencies are not risk-free – nothing is, even cash. But they are highly amenable to “risk management” strategies and are a valid asset class when considered within an overall portfolio. However when it comes to investing in crypto-currencies outside the top 5 inclusive of bitcoin, it’s buyer beware.
Whether you are a believer in crypto-currency or not, it is not going away anytime soon.
Finally, if you were in any doubt about its legitimacy then consider the ATO’s SMSF Annual Tax return which has a separate line item for crypto-currency under Item 15C – Other investments in Section H as follows:
PS: connectingthedots accepts crypto-currency payments from superannuation funds and other clients.
NB: Crypto currencies (i.e. coins) are not a financial product and hence their recommendation or otherwise is not considered financial advice under Australian law at December 2024. Please note that by using this website, you are agreeing to our Terms and Conditions and Privacy Policy. These can be found on our homepage in the footer.