These days it can be difficult to determine where to place investments, particularly with the real estate market being wildly inflated due to the COVID-19 pandemic. Many investors have taken a more cautious approach, seeking safe assets with predictable marginal returns. Recent developments driving mainstream acceptance of cryptocurrencies have positioned the once-risky Bitcoin as a secure investment with steadily high returns. Stocks and cryptocurrencies are hitting record highs, making it a prime time for new investors to break into the bullish market by directing an investment into Bitcoin mining. The best part is, these high returns don’t require a significant amount of your time and have benefits that cater to you when tax season rolls around.
With cryptocurrencies overtaking the U.S. dollar in terms of total value in circulation, and the Federal Reserve publicly stating their acceptance for digital currency, the future is looking bright for Bitcoin miners. Ethereum alone is currently worth more than the Bank of America, with Ethereum’s market cap standing at a whopping $400 billion compared to BAC’s market cap of $358.5 billion. The government has even created space for cryptocurrency on official tax returns, further validating the long-term relevance of these assets.
Gone are the days where Bitcoin was written off as a fly-by-night experiment. With large companies like Visa and Paypal accepting Bitcoin on their balance sheets, it has become safer than ever to invest in the world’s original cryptocurrency. With that safety comes the opportunity for everyday investors to take an active role in crypto mining, something that was previously reserved for individuals in the crypto-focused in-groups of secluded online chat rooms.
Beyond the value of the coin itself as an asset, the advantages of Bitcoin mining are also coming to light, both to maximize profitability and to save during tax season. How is this possible? Let’s take a look at the Antminer S19 miner, which you can purchase now for less than $15,000, to showcase these benefits.
Get Involved and Maximize Profits
Rather than purchasing Bitcoin on an exchange, you can purchase an Antminer S19 mining rig for less than $15,000 and mine for years to come, obtaining a full return on investment within a projected 12 months. While the prices of different mining rigs can vary, they continue to provide a profitable investment in comparison to high Bitcoin prices that are projected to fall no lower than $22,000 for the remainder of 2021. Further predictions see the price of Bitcoin reaching an all-time high of $100,000 by the start of the new year.
Seeing as Bitcoin has maintained a steady value this year thus far, investing in Bitcoin mining is a secure move, especially with the considerations of mining rig resale values and the Biden administration’s proposed Capital Gains tax. Even as Bitcoin prices fluctuate, new and used mining rigs maintain their value, as was seen in 2018 when Bitcoin plummeted to $3,500 yet used rigs that were selling for $70/THS at the peak of 2017 were sitting at $11.50/THS and still producing.
When Bitcoin climbed to $45,000 two years later, the same rigs went from $11.50/THS back to $70/THS and peaked at $115/THS. Those who maintained their rigs with low hosting and power prices had a secure batch of produced Bitcoin over the years from the mining rigs, as well as a batch of Bitcoin mining equipment and the choice to sell and increase their profits.
Computer Hardware – Your Best Friend during Tax Season
All mining equipment purchased is fully depreciable on tax returns as it falls under the computer hardware category, qualifying for depreciation if purchased after September 2017 and allowing you to continue mining your investment. This means that you can depreciate your hardware and save on other income, with any crypto earned through mining or staking crypto being taxable as income rather than capital gains. These tax provisions can save Bitcoin miners significant amounts of money, especially with the Biden administration’s recently proposed increase in capital gains taxes, which is an attractive prospect considering Bitcoin miners such as the Antminer S19 are estimated to produce a profit for up to 36 months.
As we mentioned above, these benefits are not just restricted to career Bitcoin miners but are open to all investors looking to put their money somewhere that matters. If you are looking to get started today, Wattum Management has a range of equipment options that you can choose from. Our world class advisory team can let you know exactly how to get the Computer Hardware Category working for you at tax time. If you are just getting involved in crypto, Wattum also offers services such as hosting, management, and a competitive mining pool to give you the benefits of crypto without the stress of having to set up a mining process of your own.
With a commitment to helping customers and crypto enthusiasts alike, and a team knowledgeable in both the American and international Bitcoin landscape, Wattum is your best bet for a successful entrance into Bitcoin mining that will provide long-term stability and efficiency for your investment as well as the highest possible returns. We are excited to support you in making educated mining decisions that maximize potential profitability and establish long-term success.