Best Crypto & Bitcoin IRA Companies – Top Cryptocurrency IRAs 2022

The step-by-step guide to retiring off your crypto investments.

The world of personal finance has become far more exciting lately as social media and hustle culture has taken over. The introduction of cryptocurrency has made the journey to acquiring financial freedom much more intriguing for the new generation of finance enthusiasts. However, one topic under the umbrella of personal finance has not reached the same hype as the rest. The irony of this exclusion is that without understanding this left out topic, one can never truly achieve financial freedom.

The topic in question is none other than… retirement. Yes! Retirement is often left as an afterthought on one’s road to financial success. Still, to enjoy the lifestyle that you set up for yourself with short to medium-term investments, you need to ensure that you’ll be able to enjoy that lifestyle until your last day. That’s where your retirement investment strategy plays a big part. Thankfully, strategic investments into certain crypto funds can help you do this and make it enjoyable.

We are introducing the elusive and ever-essential Crypto IRAs!

What is a Crypto IRA?

IRAs are not exclusive to the blockchain financial industry and have been around since the prehistoric dawn of the government bond. Traditional individual retirement accounts (IRAs) are a staple in every wise investor’s portfolio as they provide a sense of financial security that few alternative investment classes can boast.

As the world becomes more globalized and economies become more interconnected, the political or economic volatility experienced in one corner of the earth quickly affects all the other corners. For this reason, investors prioritizing long-term financial stability find it wise to diversify their investment portfolios, including their retirement accounts. What better way to diversify your investment portfolio than adding a few crypto coins or tokens?

The idea of a valuable investment asset has evolved over the years from gold bars to ones and zeros in your bank account. The next logical step is cryptocurrency. With the introduction of digital assets, the IRAs introduced specialized management protocols and increased their data protection capabilities. All of this has led to a rise in crypto-specialized IRAs.

This article will outline the best choices of these self-directed IRAs for all your personalized retirement needs.

How do Crypto IRAs work?

The crypto IRA falls under the umbrella term “self-directed IRA.” What does this mean? The short answer is choice. Investors can choose which assets to buy within their retirement accounts. Some investors may take the safe route and use the tried and tested real estate, precious metal combo. Who can go wrong investing in gold and condos on the billionaire’s row?

The long answer is that people are diverging from traditional investment strategies and opting for betting on the future. That’s where cryptocurrency comes in. Unlike most fiat currencies and even real estate, popular cryptocurrencies come with a supply cap that guarantees their market value in the future. The other benefit of investing in crypto, like Bitcoin, for your retirement is that you will directly benefit from the natural trajectory of the coin’s growth while guaranteeing the diversification of your overall investment portfolio.

The only caveat is that due to the novelty of blockchain technology and crypto as an asset class, the IRS categorizes bitcoin, and similar coins, as property. This means that it is taxed like stocks and bonds, and often, you need a custodian to manage your IR account.

There are a few things to consider before opting for either a self-directed or traditional IRA:

•       Limits: IRAs are subject to $6000 – $7000 annual contribution limits due to the tax benefits associated with the account.
•       Custodian: Think of this person as the Hagrid of your crypto IRA. They safeguard your account, ensure everything goes according to plan, and comply with IRS and governmental regulations.
•   An exchange: This resembles a shared trading platform where your cryptocurrency trades and transactions are conducted.
•       A secure storage solution is perhaps the most critical component to consider. Due to the high rate of cybercrime surrounding the blockchain space, it is vital to consider the digital security of your IRA company of choice. Each company will likely use proprietary secure storage methods, but some independent research might be in order.

Self-directed IRAs are likely to have a variation of each of these components, and it is crucial to consider which combination works best for you.

What are the benefits of Crypto IRAs?

There are a few irrefutable benefits to choosing a self-directed crypto IRA as your retirement investment strategy:

1. Diversification:  Cryptocurrency, while highly volatile in its own right, is entirely detached from global affairs compared to regular stocks and bonds. This makes it a good choice for diversification.
2. High return potential: Ethereum has gone up over 400% since 2020 alone. Bitcoin has eclipsed that, and many other crypto coins have experienced similar bull runs. This echoes the idea that cryptocurrencies often reach new impossible returns for their investors!

Adam Bergman, founder and CEO of IRA Financial, says: “Bitcoin is very volatile, but with volatility comes the potential for huge gains.”

3. Tax advantages: Due to the sheer volume of crypto transactions any trader may execute, calculating capital gains tax is a nightmare. That is why investing through a ROTH IRA or traditional IRA is preferential and alleviates some of the tax burdens as long as the money is still in your account.

“The single greatest headache for Bitcoin investors is tracking trades and calculating taxes owed,” says Eric Satz, CEO, and founder of Alto.

What are the risks of Crypto IRAs?

Along with the upsides to opting for a crypto IRA, a few real risks to this investment class need to be considered.

1. Fees: Fees are associated with investing in crypto assets through a self-directed IRA that is not usually associated with a traditional IRA. These fees are due to setup costs and trading fees.
2. Exchange limitations: Many crypto IRAs are strict about which crypto exchanges you are permitted to trade on. This is usually due to an affiliation, but it can be pretty annoying to limit it in this way.
3. Value Volatility: High risk, high reward. This is the motto of any crypto investor who saw Bitcoin sink from $20k in 2017 to $3k in 2018 and back up to $19k in 2022. This price volatility is given when investing in cryptocurrency, but it might not fit everyone’s risk profile.
4. Capital gains loss: Traditional taxable accounts can offset the capital gains losses due to tax through a technique known as tax-loss harvesting. This sneaky trick allows investors to sell some of their stocks at a loss to offset the gains from other stocks. They are then only taxed on the profit (gains — losses). Due to the property classification of crypto, this is not possible, unfortunately.  
5. Complex: The nature of the crypto market makes for much bureaucratic uncertainty. That’s why Big Brother wants you to have another retirement account aside from your crypto IRA. This requirement is layered on top of the need to list requirements to have a custodian and ensure your IRA has a secure storage plan and an affiliation with an exchange platform.

What are the best Crypto IRA platforms?

Bitcoin IRA

Bitcoin IRA is a Bitcoin IRA that provides cold storage for digital assets. The company was established in 2016 and is the largest IRA company in the world that allows individuals to invest in cryptocurrency through their retirement accounts.

The platforms allow for 24/7 trading and makes creating an IRA account and digital wallet intuitive and quick. The typical waiting time for deposited funds is 3-5 days, and then you can buy, sell and trade cryptocurrency all day and night. It charges custodian fees and one-time set-up fees to use the platform. It is the most established crypto IRA company and offers its users increased storage security.

Pros	Cons
Easy to setup and trade	High setup and maintenance fees
Insurance for digital assets up to $700 million
Secure offline storage for digital assets
Supports over 60 cryptocurrencies

 

iTrustCapital

 iTrustCapital is the most affordable option on this list as it offers very low transaction and set-up fees relative to other crypto IRA companies. Its interface accommodates both first-time investors and veteran crypto investors. It also boasts a team of expert consultants and transparent fees to make the investment process as seamless as possible.

iTrustCapital’s partnership with Coinbase in 2016 allowed the crypto IRA company to use Coinbase custody to secure its digital assets. This coverage is added to the primary cover and insures up to $370 million. This is truly the best choice for price-conscious investors.

Pros	Cons
24/7 trading	There is no financial advisor.
Low account and transaction fees
Minimum investment of $1,000
Supports 29 types of cryptocurrencies

 

Coin IRA

Coin IRA has set itself apart by providing an investment opportunity and its clients with an educational opportunity into the world of cryptocurrency and how they can increase the ROI of their retirement accounts. This company offers low fees and is user-friendly for first-time investors.

Coin IRA offers its clients to open an account or the option to transfer funds from a non-IRA account at a minimum amount of $5,000. This amount is offset by the fact that it does not ask for setup or maintenance fees from its clients. This is a good choice for those who want a helping hand in their investing journey from expert consultants.

Pros	Cons
Low transaction fees	No cryptocurrency consultants are available
No annual or maintenance fees	It does not offer varied wallet options
Educational for investors

 

BitIRA

BitIRA is perhaps the most secure Crypto IRA on the market. They offer dollar-for-dollar insurance coverage. This is provided for all the digital assets and offline cold storage of private keys. This is why BitIRA is the security pick for crypto IRAs.

The platform only supports 9 cryptocurrencies, namely Bitcoin, Ethereum, etc., which it lacks in diversity of assets; it makes up for with its multi-encrypted security strategy. The company goes so far as to secure clients up to $1 million against cybercrime and fraud. If Liam Neeson were a Crypto IRA, he’d be BitIRA.

Pros	Cons
Digital assets are stored securely offline	Must open accounts with a digital currency specialist
Full insurance for digital assets
Multi-encrypted transactions

 

Equity Trust

Equity trust is a behemoth in the IRA industry, with 45 years in the game. This company has experience with both traditional and alternative investment assets. This is a favourite among self-direct IRA investors due to the ZERO transaction fees and world-class expert consultants.

To open an account with Equity Trust, clients must speak with one of the company representatives. Once the account is open, clients can invest in 8 cryptocurrencies, including Bitcoin, Ethereum, and Litecoin. You will then enjoy $0 transaction fees and multi-factor security on 6 different levels. The only time you pay is when you set up your account; this can be expensive, depending on your account size. The second fee is attached to cold storage fees. This is perhaps the first choice for those who prioritize expertise and experience. 

Pros	Cons
Almost 50 years of self-directed IRA experience	Must open accounts with a representative
Support traditional and alternative investments	High administration fees
Zero transaction fees
It uses 6 layers of security.

 

Regal Assets

Regal Assets is a cross-platform that allows clients to invest in tangible and digital assets through their IRA platform. It boasts an impressive variety of cryptocurrencies to invest in. The company was founded in 2009 but only offered the option to invest in cryptocurrency in 2017.

This company was awarded the first cryptocurrency trading license in the US. This established Regal Assets as a giant in the Crypto IRA space. To become a client, the set-up process is relatively easy, and it is made more accessible when a representative calls the applicant to help them through the process. For the first year, clients can expect to pay $0, after which they will pay an annual fee of $250 for membership and storage. All in all, it is the best choice for investors interested in investing in multiple altcoins.

Pros	Cons
Supports multiple cryptocurrencies	Accounts are restricted to representative platforms
Flat fee rates
The largest variety of cryptocurrencies is supported

 

Are Crypto IRAs safe to invest in?

To put it existentially, is anything genuinely safe to invest in?

Okay, jokes aside, there is a level of uncertainty inherent to the cryptocurrency market. It is up to the individual to consider if this level of risk is something they are comfortable taking on. Some of the risks are directly linked to the digital nature of the asset class and its vulnerability to cyber-attacks. Many IRA companies invest a large sum into the security and encryption infrastructure to afford their clients the best storage security possible.

How do you open a Crypto IRA?

The road to opening your very own Crypto IRA can be bumpy, but this should guide you through it smoothly. You’ll need your social security number, current address, and banking details on hand before making your first step. Got it? Great, let’s open up your Crypto IRA!

Step 1: Figure out your personal goals for the account.

Step 2: Find a suitable custodian to host your account.

Step 3: Select an IRA company with suitable account types and trading options depending on your goals.

Bonus step: Compare transaction fees before setting your heart on an IRA.

Should you open a Crypto IRA?

If you’re two days from hopping onto the retirement express, it’s probably too late to benefit from a well-diversified Crypto IRA fully. If you still have three days or longer until the sweet bliss of retirement, then perhaps you should give it a go. Due to the relative newness of the crypto asset class, it is not advisable to dedicate your entire retirement fund to cryptocurrency.

It would be beneficial to dip one’s toe into the well of digital gold with a portion of your retirement fund. This would serve as an alternative asset class to experiment with. Due to the complex nature of investing in crypto and its various components, it is crucial to do independent research before truly delving into crypto as a significant investment asset. This might be the 80/20 principle, with your minority investment into cryptocurrency outperforming any other asset class in your portfolio!

Can you buy crypto in a Roth IRA?

If you have a standing Roth IRA, you will most likely be unable to use it to invest in cryptocurrency or similar digital assets. Most Crypto IRAs are self-directed and require the investors to open up a specialized account for this asset. Although, there is a chance that traditional Roth IRAs will add cryptocurrency to their investment options. But who wants to wait on that possibility? You’d be missing out on the potential ROI you could gain in the meanwhile.

Final thoughts

When thinking of the vast arranged investment classes, one stands above in terms of potential gains and inherent risk. This is why independent research should be the first step anyone takes before considering a Crypto IRA.

Roth IRAs have been a staple in the investment journey of most diligent investors in the United States of America. What’s new is the introduction of digital assets such as Bitcoin. This introduced a further need for expertise, security, and consultation for people to successfully invest in a Crypto IRA successfully. This retirement account is perhaps the best way to future-proof your retirement account. Still, it involved unavoidable risks due to the sheer novelty of cryptocurrency and its lack of predictive data due to how new the technology surrounding it is.

That being said, the examples of IRA companies listed in this article are not exhaustive and will only increase as traditional financial instructions accept Bitcoin and other cryptocurrencies as a cemented part of the fintech infrastructure. Simply put, crypto is here to stay, and it might be wise to research its potential as an investment asset class to secure the highest ROI from your crypto investments ASAP!