Most exchanges require the investor to be over the age of 18, but a parent or guardian can invest in a crypto basket on behalf of minor children if they submit some extra documentation.
24 May 2022 00:09
Could you please guide me on crypto baskets and how to get them? I am a pensioner from Lesotho. I want to invest in them for my kids.
Thank you for your question.
A cryptocurrency basket can refer to a collection of digital assets such as tokens that investors can buy and manage as a bundle. In this manner, investors can monitor their digital assets as a whole, rather than oversee them individually. Cryptocurrency baskets are tailored for investors who are looking for an effortless and convenient investment option that provides them with exposure and diversification across multiple cryptocurrencies. The basket of cryptocurrencies will include a carefully selected group of digital assets that meet a strict criterion.
Although investing in cryptocurrency seems like a good idea it is important to know that the industry is very risky to invest in considering that it is not real money and that it remains unregulated. However, in South Africa, the crypto industry is expected to be regulated by the end of 2022. Once that is done, advisors will be able to propose the investment to clients.
In the meantime it is not difficult to find a platform that provides crypto baskets. Among these product providers are Jaltech, Easy Equities, Revix and so on.
There are a few advantages of investing in a crypto basket:
- Diversification: You are not limited to one type of cryptocurrency, there are several types of crypto you can invest in like bitcoin, ether, Polkadot, Chainlink and so on, all in one investment!
- Investment management: If you are not well informed on the market and do not like to do a lot of research or track market movements or gamble on your investments, there are people who can manage your portfolio for you.
- Cryptos are managed based on market movements: Cryptos are added or removed based on how the market performs.
- Storage: The crypto is kept in storage where there is no exposure to occurrences like cyber attacks and losing coins on digital platforms.
- Affordability: You do not always require a large sum of money to start investing. The minimum investment amount can range from as little R100 to R50 000 depending on the platform you choose to invest with.
How to invest in a crypto basket?
Investing in our basket of cryptocurrencies requires the completion of an application form and submitting all the required Fica documents (ID/passport, proof of residence not older than three months, and a tax number).
As for your question about investing for your children, most exchanges require the investor to be over the age of 18. However, with a crypto basket, a parent/guardian can invest on behalf of their children and may be required to submit some extra documentation, in addition to the normal Fica documents, such as:
- The guardian to sign the application form on behalf of the child;
- The guardian to sign a Foreign Account Tax Compliance (Facta) form;
- The child’s birth certificate and ID;
- The guardian’s ID;
- An affidavit stating that the child lives with the guardian; and
- If the guardian is not the parent or if their name is not on the birth certificate, an affidavit stating that they are the legal guardian of the child.
Should you require more info, you are welcome to contact our office.
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