In case you hadn’t noticed, Bitcoin has been enjoying a surge in popularity. The Covid-19 crisis parked interest in alternative stores of value – with gold the prime beneficiary. Now cryptocurrencies, with Bitcoin once more to the fore, are firmly back in the spotlight.
Lat week, the Bitcoin price reacjed $19,850, just above its previous highest price of $19,783 back in December 2017.
Other fintechs are beginning to jump on the crypto bandwagon, with the likes of Freetrade and Revolut seeing a massive spike in interest from their customers about investing in Bitcoin—Revolut even gave away a whole Bitcoin as part of its Black Friday competition.
In a survey conducted in partnership with Opinium, as part of AltFi’s Digital Wealth and Banking Study, it was discovered that just ten per cent of people surveyed bought crypto assets, including Bitcoin.
Following the crypto boom in 2020, the Financial Conduct Authority (FCA) said that more than one million consumers bought crypto assets for the first time this year, bringing the UK total up to 2.6 million people who’ve bought cryptocurrencies, with 1.9 million still holding crypto assets.
The most Bitcoin-mad region is, slightly unsurprisingly, London, with one in four people (24 per cent) living in the Nation’s capital having purchased cryptocurrency.
Historical Performance And IFISA Process Guide
That figure is the result of over £20 million of loans facilitated on the site, as we bring individuals looking for a good return on capital together with carefully vetted small companies seeking funds for growth. Bear in mind that lenders’ capital is at risk. Read warnings on site before committing capital.
All loans on site are eligible to be held in a Money&Co. Innovative Finance Individual Savings Account (IFISA), up to the annual ISA limit of £20,000. Such loans offer lenders tax-free income. Our offering is an Innovative Finance ISA (IFISA) that can hold the peer-to-peer (P2P) business loans that Money&Co. facilitates. For the purposes of this article, the terms ISA and IFISA are interchangeable.
So here’s our guide to the process:
The ISA allowance for 2019/20 is unchanged from last tax year at £20,000, allowing a married couple to put £40,000 into a tax-free environment. Over three years, an investment of this scale in two Money&Co. Innovative Finance ISAs would generate £8,400 of income completely free of tax. We’re assuming a 7 per cent return, net of charges and free of tax here.
Once you have made your initial commitment, you might then consider diversifying – buying a spread of loans. To do this, you can go into the “loans for sale” market. All loans bought in this market also qualify for IFISA tax benefits.
Risk: Security, Access, Yield
Do consider not just the return, but the security and the ease of access to your investment. We write regularly about these three key factors. Here’s one of several earlier articles on security, access and yield.