There are a lot of Hodlers out there that have major gains in Bitcoin right now. Some are old money that acquired their fortune in the early days of Bitcoin when Satoshi Nakamoto was still involved. While other are newer maybe buying Bitcoin just before the big run up in 2020 or finding a block while solo mining. Whatever the case is, there is one thing that is common. Bitcoiners are all in on BTC Life Insurance.
A relatively new product to the market, Bitcoin Life Insurance, is collectively saving investors billions of dollars in taxes. This is because with this product, investors can borrow against their Bitcoin and convert their Bitcoin to cash tax-free.
It works like this:
Fund the policy in Bitcoin.
- You make 10 annual payments in Bitcoin.
Grow the Bitcoin
- The value of your Bitcoin grows with the market inside the policy.
Use your Bitcoin (you still own the Bitcoin while its in the policy) as collateral with a low interest loan that has no fixed repayment schedule and no margin call risk!
Death Benefit is paid in Bitcoin.
- When the time finally comes, and you die, your legacy is transferred to your loved ones in Bitcoin.
David Walls, the go-to broker for Bitcoin Life Insurance is located in Florida. He says that Bitcoiners cannot sign up fast enough. They want to take advantage of their wealth while the market is up. But when promoted about margin-call risk, he says “rest assured, there is no risk. In fact, you will only benefit from a market decline.”
This is because the insurance carrier that offers the product, Meanwhile, only deals in Bitcoin. It is the currency they use. Therefore, if you have a loan out, and the value of Bitcoin drops, then you can repay the loan at a lower cost (in USD) to you. David Walls says, “It’s sort of like ‘shorting’ Bitcoin in that sense.”
As for the loan itself, it’s among the lowest interest rates in the industry. Currently sitting at about 3% interest, as compared to other loan companies like Ledn that is currently charging more than 12%. It only makes sense why more and more Hodlers are choosing to utilize a BTC Life Insurance policy over other traditional means.
And it’s not just people in the high tax states like California and Illinois that are buying BTC Life Insurance for taxes reasons either. David Walls says he has customers all over the country, in states like Texas, Tennessee, Virginia, Florida, and New Jersey as well. “People want to take advantage of their wealth, but don’t want to sacrifice 50% of it to Uncle Sam. Plus, they get to protect their loved ones at the same time. It’s a win-win!”
With Bitcoin Life Insurance, a typical healthy thirty-something year old can put in a few Bitcoin and get double the amount in a death benefit. For example, you put 10 Bitcoin in, you often will get about a 20 Bitcoin death benefit to leave to your heirs.
