Prior to finding the best crypto IRA (Individual Retirement Account) in which to invest, I’d been funneling money into standard bank and brokerage IRAs and 401Ks since my very first job.
Alas, that first job was many more years ago than I care to count, before Bitcoin even existed.
My steadfast commitment to saving for retirement, even when my income was super low and it didn’t feel like I was making a dent in my savings growth, was the best decision I ever made.
My IRA funds now count as my single biggest asset under the umbrella of my net worth. In total, they’re worth more than any property, vehicles or other assets I own, combined.
Everyone should seriously consider maxing out their retirement accounts each and every year of eligibility to capitalize on the juicy tax advantage and long-term growth potential.
These days, in addition to bank and traditional brokerage IRAs, you can choose to do that through specially designed, self-directed, crypto IRA companies.
Benefits of a Crypto IRA Account
Via the traditional brokerages I use, I invest IRA funds in investments like stocks, exchange traded funds (ETFs) and bonds.
But up until the past few years, what I haven’t been able to directly invest in via brokerage IRAs is Bitcoin and other cryptocurrencies.
That’s all changed with the advent of the Bitcoin IRA and crypto IRA.
These self-directed IRA crypto accounts allow tax-advantaged investment into Bitcoin, Ethereum and numerous other cryptocurrencies. In some firm’s crypto IRA accounts, you can invest in any cryptocurrency you want.
This is an important evolution in the crypto space, as since 2014, the United States has taxed cryptocurrencies in the same way they tax investments like stocks and bonds.
In addition to the tax advantages, another great thing about a cryptocurrency IRA is that it allows you to diversify your retirement portfolio.
As the crypto space is projected to grow in popularity over time, investing in a crypto IRA allows you to invest now and plan for the long term while taking advantage of the tax benefit.
Investing in an IRA is typically done on a timeframe of decades, not years. So if the crypto space fulfills the potential many think it has, you just might be handsomely rewarded in your retirement years for your investment now.
Crypto IRA Companies
The following crypto IRA companies allow you to add cryptocurrency exposure to your IRA and enjoy the long term benefits.
In addition to the information below, it’s important that you thoroughly research the firm you choose.
Note that these companies will each offer different levels of safety and security of your funds. You should ensure that the company you ultimately choose meets your needs and fits your risk profile.
Bitcoin IRA – Best Overall
Bitcoin IRA is a well-known crypto IRA company that boasts 170,000+ users. With a proprietary platform, you can trade 60+ cryptocurrencies 24/7.
The Bitcoin IRA dashboard offers live price tracking and portfolio performance. Via BitGo and their insurance provider, the company offers a custody asset insurance package.
Bitcoin IRA has crypto IRA specialists you can talk to on the phone and I’ve found the knowledge of the service representatives to be above par.
Key Benefits
- Over $2B in transactions and 170,000+ users
- Invest in 60+ cryptocurrencies
- Trading platform available 24/7
- Custody insurance by BitGo
- Variety of IRA accounts available: Roth/SEP/Rollover
BitIRA – Best Security
BitIRA offers a streamlined process for investors to open a crypto IRA.
Founded by the Birch Gold Group, which has vast experience helping customers to purchase precious metals for their IRA, the company is adept at efficiently getting digital currencies into your retirement account, too.
BitIRA offers FDIC insurance for cash (does not cover crypto or other assets). Your crypto keys are secured in cold storage, inside grade-5 nuclear bunkers and protected by armed guards.
Key Benefits
- Streamlined process for opening and account setup
- FDIC insurance for cash
- Private keys kept in cold storage
- Registered with a branch of U.S. Treasury
- Easy rollovers
iTrustCapital – Best Fees
iTrustCapital is a popular platform for investing in crypto and precious metals in your IRA.
They’ve done $6B in transactions and 175K+ accounts have been created. Their asset list consists of 25+ cryptocurrencies in which you can invest.
Their utilization of Coinbase Custody and Fireblocks enhance security and help protect your assets.
Recently iTrustCapital has introduced crypto staking and the opportunity to earn good APY on select coins.
Key Benefits
- $6B in transactions and 175K+ accounts created
- 24/7 investing
- No setup or monthly fees
- Protected by Coinbase Custody and Fireblocks
- Crypto staking available (limited)
Crypto IRA Account | Q & A
What is an IRA (Individual Retirement Account)?
An IRA is an account used to save for retirement, with the benefit being that you get either tax-deferred growth or tax-free growth, depending on the specific type of account you utilize.
A Traditional IRA allows you to contribute pre-tax money that you can grow, tax-deferred, until the time you withdraw the funds in retirement.
A Roth IRA allows you to make contributions with after-tax money that can grow tax-free and be withdrawn tax-free in retirement.
There is also a Rollover IRA which allows you to “roll over” money from employer retirement accounts, like 401Ks.
What’s a Crypto IRA?
A crypto IRA, sometimes referred to as a Bitcoin IRA, is a self-directed IRA that allows you to invest in cryptocurrencies like Bitcoin, Ethereum, Solana and more.
It allows you to gain the same tax advantages you would if you had funds in a bank or brokerage IRA and were invested in stocks, bonds, mutual funds, etc.
What is a Self-Directed IRA?
A “self-directed IRA” is the type of IRA that allows you to invest in “alternative” assets like crypto.
Essentially, it allows you to expand your investing horizons, outside of traditional investment vehicles, into areas you know, understand and/or are passionate about.
Can I hold crypto in a regular bank or brokerage IRA?
In short, no you can’t.
Bank and brokerage IRAs offer investment vehicles like CDs, stocks, bonds, ETFs, mutual funds, etc.
Many brokerage accounts will let you invest in vehicles like Grayscale Bitcoin Trust, which can be bought and sold like a stock. However, that is not the same as owning actual Bitcoin or other crypto.
Can I buy a crypto stock instead?
There are many crypto stocks that allow you to gain exposure to the growth of the crypto industry, without having to actually buy individual cryptocurrencies.
These stocks give you shares of ownership in a crypto-related company. For example Coinbase, Block or Nvidia are each associated with the crypto industry in various ways.
You can easily buy crypto stocks using a brokerage account like Robinhood or M1 Crypto.
Final Thoughts
Saving for retirement via a crypto IRA, or any IRA, is something everyone should consider doing from the time they are eligible. Eligibility is typically based on income and sometimes age, depending on the type of IRA.
The tax advantage of IRAs and the long-term nature of these types of accounts allow for potentially significant compounding growth.
As you dive deeper into crypto IRA accounts, do make sure to thoroughly understand all of the rules, regulations, fees and other pertinent matters associated with IRAs in general.
Also, thoroughly research the crypto IRA companies with whom you choose to open accounts and conduct business.
Disclaimer: The above is the writer’s opinion and should not be considered investment advice. Readers should do their own research and/or consult a financial advisor. Any actions taken based on the information above is at the reader’s own risk.