cryptojournalist
Bitcoin’s rise in value has led to some unique financial options, like Bitcoin-denominated life insurance, which is especially attractive to long-term Bitcoin holders (often called “hodlers”*). This type of life insurance not only provides coverage but also has tax perks that can make it a valuable asset over time.
The idea is to combine Bitcoin, a long-term investment, with whole life insurance, a type of lifelong policy. This approach lets policyholders borrow against the value of their insurance without paying taxes—a key benefit that’s become a big draw. Since the policy is valued in Bitcoin, it grows along with Bitcoin’s value, creating a larger pool to borrow from as Bitcoin appreciates.
Imagine paying your insurance premiums when Bitcoin is worth $63,000. Years later, if Bitcoin reaches $1 million, you could borrow against the policy’s increased value. Because of how this cost basis works, you could then sell it without owing capital gains taxes, as you’re selling it at the current value.
To learn more about how Meanwhile Advisors manages these policies, their regulation, and other details, you can listen to their recent podcast interview on Cointelegraph’s lineup.
Terms Explained:
Hodlers: A playful term for people who hold onto their Bitcoin for the long haul, regardless of market ups and downs.
Whole Life Insurance: A lifelong insurance policy that includes a cash value, letting it grow over time.
