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Crypto is one of the most exciting and rapidly growing investments available. It’s a new asset class that has seen huge gains over the past few years, and it’s becoming increasingly popular among investors. But did you know that you can also invest your IRA funds in crypto? That’s right – you can use your retirement savings to build a portfolio of digital assets. Read on to learn more about how it works.
What Is an IRA?
Before we discuss how to invest your IRA in crypto, let’s take a step back and explain what an IRA is. IRA stands for Individual Retirement Account, and it’s a type of tax-advantaged retirement account that allows you to save for retirement without paying taxes on income or capital gains until you withdraw the funds from the account. There are two types of IRAs – Traditional IRAs and Roth IRAs – but both offer tax benefits when used properly. (Learn more here on Wallet Wisely)
How Can I Invest My IRA in Crypto?
The first step toward investing your IRA in crypto is to open an IRA account with a custodian that specializes in digital assets such as Bitcoin or Ethereum. Digital asset custodians provide secure storage solutions for digital assets, as well as services such as buying/selling and trading cryptocurrency on behalf of customers. Once your IRA account is set up, you can deposit funds, up to you your IRA maximum, or transfer funds from your Traditional or Roth IRA into the new account and start building your portfolio of digital assets.
Crypto IRA Providers
Here are our top Crypto IRA providers:
#1 – BitcoinIRA
- Buy and sell 60+cryptocurrencies in your IRA.
- Live Support from IRA Specialists
- Up to $700M in Insurance Coverage
- Shielded with military-grade security from industry-leading wallet solutions
- Protected by cold storage to prevent security leaks
- $100 new IRA / $3,000 transferred IRA
3,500+ 5-Star Ratings
Bitcoin IRA is the world’s first and most trusted cryptocurrency IRA platform used by thousands of clients. Your digital assets are stored with our exclusive partner, BitGo the world’s largest processor of Bitcoin transactions, processing over 20% of all global transactions. BitGo is SOC 2 Type 2 certified and it’s proprietary cold-storage wallets provides military-grade, multi-key security protecting your wallet against any single point of failure. Simply put, no other crypto IRA provider can match this level of protection.
#2 ITrust Capital
- Buy Cryptocurrencies and Spot Gold and Silver
- Low Transaction Fees
- Account Minimum of $1,000
- No Monthly Account Fee
- Institutional-Grade Offline Storage (cold storage)
iTrustCapital is the leading digital asset IRA software platform that allows clients to directly buy and sell cryptocurrencies and physical gold in real-time through their retirement accounts. Founded in 2018, iTrust Capital has a goal of helping 10 million people invest safely in blockchain assets. The company has already supported more than $6 billion in transactions. iTrustCapital allows investors to buy and sell crypto in real time inside their tax-advantaged retirement accounts.
#3 Alto Crypto IRA
- Invest in 200+ cryptocurrencies through Coinbase Integration.
- Assets held by Coinbase.
- FDIC Insured for $250,000 cash
- Low Fees
- Coins and tokens are held 1:1 in institutional-grade hot and cold storage maintained by Coinbase.
Alto CryptoIRA Clients could trade any crypto available on Coinbase with an Alto CryptoIRA account. Alto IRA’s partner Coinbase has a strong reputation for being one of the most secure and compliant crypto exchanges. Not only that, Coinbase has become a significant crypto custodian for institutional clients.
Benefits of investing IRA funds into crypto.
One of the main advantages is the potential for high returns. Cryptocurrency has historically been a volatile and high-risk asset, but it has also delivered significant returns over time. For example, Bitcoin, the largest cryptocurrency by market capitalization, has risen from less than $1 in 2009 to over $50,000 in 2021.
Another benefit of investing IRA funds into crypto is the potential for tax advantages. IRA contributions and earnings are typically tax-deferred, meaning you don’t pay taxes on them until you withdraw the funds. If you invest in cryptocurrency through an IRA, you can potentially defer taxes on any gains until you withdraw the funds in retirement. Additionally, if you invest in a Roth IRA, you can potentially withdraw your crypto gains tax-free in retirement.
Risks of Cryptocurrency Investing
There are also risks associated with investing IRA funds into crypto. Cryptocurrency is a relatively new and untested asset class, which means there is a high degree of uncertainty and volatility. Prices can fluctuate wildly based on news and events, and there is a risk of losing your entire investment. Additionally, there are security risks associated with storing and managing cryptocurrency, which can be a target for hackers and other cyber criminals.
Before investing IRA funds into crypto, it’s important to do your research and understand the risks involved. Consider consulting with a financial advisor or investment professional who specializes in cryptocurrency to help you make informed decisions. Additionally, consider investing in a diversified portfolio of cryptocurrencies to reduce risk and potentially increase returns o