The Best Crypto IRAs

By  Beluga Research November 28, 2023

A crypto IRA is an individual retirement account focused on cryptocurrencies, offering investors exposure to alternative assets unavailable in their traditional IRA. A crypto IRA is a great option for retirement planning due to its many benefits including tax advantages, security of assets and the ability to control retirement savings. These factors can help investors get exposure to the crypto markets in a safe way that is also tax friendly. Read More

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iTrustCapital

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Top Pick

iTrustCapital

Minimum Account Requirement

$1,000

Fees

1% fee per transaction

Custody Platform

Fireblocks

BitIRA

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BitIRA

Minimum Account Requirement

$5,000

Fees

$50-account setup, $195-annual fee, 0.05%-transaction fee

Custody Platform

Equity Trust

Coin IRA

Coin IRA Logo

Coin IRA

Minimum Account Requirement

$5,000

Fees

Transaction fee ranges between 1.25%-2.25%

Custody Platform

Fireblocks

Bitcoin IRA

Bitcoin IRA Logo

Bitcoin IRA

Minimum Account Requirement

$3,000

Fees

A one-time service fee ranging from 0.99% to 4.99%

Custody Platform

BitGo

Unchained Capital

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Unchained Capital

Minimum Account Requirement

$6,000

Fees

Setup fee-$995, 5% annual fee

Custody Platform

The investor

Swan Bitcoin

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Swan Bitcoin

Minimum Account Requirement

No minimum requirement

Fees

0.99% transaction fee

Custody Platform

Prime Trust

Alto IRA

Alto IRA Logo

Alto IRA

Minimum Account Requirement

$10

Fees

1% transaction fee and $10 monthly account fee

Custody Platform

Coinbase

Questions & Answers

Q.Why are IRAs a good tool for crypto investing?

A. IRAs are a valuable tool for planning and saving for retirement. There are many reasons why an IRA is a great option for retirement planning, including tax benefits, flexibility and the ability to control retirement savings.

Q. What are the tax advantages of an IRA?

A. One of the key benefits of an IRA is the tax advantages it offers. Depending on the type of IRA chosen, an investor may be able to deduct contributions from taxable income which can help reduce tax bills. Additionally, if an investor chooses a Roth IRA, contributions and earnings will grow tax-free. This means an investor won't have to pay taxes on the money withdrawn during retirement. This can be a significant advantage, as it allows investors to keep more hard-earned money!

Q. What kind of assets can be put into an IRA?

A. Another benefit of an IRA is the flexibility it offers. Unlike many other retirement savings options, IRAs allow investors to choose from a wide range of investment options. These include stocks, bonds, mutual funds, crypto and precious metals, among others. This provides the ability to customize a portfolio to meet individual needs and goals, and to adjust investments as needs change over time. In addition to flexibility, IRAs also offer the ability to completely control retirement savings.

Q. How are IRAs managed?

A. Unlike traditional employer-sponsored retirement plans, which may limit investment choices or require meeting certain criteria to access funds, with an IRA, investors are in charge of retirement savings. An investor can choose how much to contribute each year, which investments to make, and how and when to withdraw funds. One important consideration when deciding whether an IRA is right is age. If an investor is younger and has many years until retirement, an IRA can be a great way to start saving early. This can take full advantage of the power of compounding. By contributing even a small amount each year, an investor can build a significant nest egg over time that will help secure a long-term financial future.

Q. At what age should people start investing in an IRA?

A. Even if someone is close to retirement age, an IRA can still be a valuable tool for saving and planning. Carefully choosing investments and making regular contributions can help ensure having enough money to enjoy a comfortable retirement.

Q. Who is a crypto IRA best suited for?

A. Those who are highly long-term bullish on crypto. Don't want the hassle of holding crypto. In that case, crypto IRAs could be a good fit. It's important, however, to plan to hold the crypto until 59 ½ years old to maximize tax benefits. Crypto is very volatile. This means probably going through several up and down crypto market cycles. Access to funds without a penalty isn't possible, so this is not for those who like to be on the trigger finger!

Q. Are all IRAs crypto IRAs?

A. No. There are only a select few IRAs that specialize in digital assets. This is because crypto requires special wallet services (also known as custody) and insurance in order to provide proper protections for investors. This article has a comprehensive list of great crypto IRA choices. It's important to research the landscape before choosing a crypto IRA as each company offers different features, fees and setup.

Q. What is an IRA contribution?

A. An IRA contribution is a type of retirement account that allows individuals to save for their future. It stands for Individual Retirement Account, and it offers tax advantages to those who contribute to it. In today's market, IRA contributions are becoming increasingly popular as people realize the importance of saving for retirement. With the uncertainty of government-funded retirement plans and the increasing costs of living, many individuals are taking it upon themselves to secure their financial future. There are many options for IRA contributions, including traditional IRAs, Roth IRAs, and SEP IRAs. Each has its own set of rules and benefits, so it's important to research and choose the best option for each individual's needs.

Q. Are IRAs managed by a financial professional or directed by an individual investor?

A. IRAs can be managed by a financial professional. Or, they can be self-directed by an individual investor. It ultimately depends on the individual's preference and level of investment experience. Some people may feel more comfortable having a professional manage their IRA. Others may prefer to have more control over their investments. It's important to do proper research and choose the option that aligns with specific financial goals and comfort levels.

Q. What is an IRA rollover?

A. An IRA rollover is a transfer of funds from one retirement account to another. This is typically done when an individual changes jobs or wants to consolidate multiple retirement accounts into one. By rolling over the funds instead of withdrawing them, individuals can avoid penalties and taxes on early withdrawals. It's important to follow the rules and regulations of the specific type of IRA being rolled over to avoid any negative consequences.

Q. Are these crypto IRAs safe?

A. These IRAs are holding the crypto, so they are at risk of hacking and theft. However, most of them have insurance policies protecting the consumer. Consider these factors when deciding which IRA to use. The U.S. government regulates IRAs, so there is some oversight as to how these are administered. But crypto as an asset class does have some degree of risk, particularly in the short-term, as the markets are volatile. It's important to consider the long-term implications of cryptocurrencies, especially when planning for retirement, which is like playing the larger time horizon versus a shorter one.

Q. Is it possible to buy crypto from my eTrade or Schwab account or use my existing IRA provider?

A. No, investors will need to open a new account. There are very few crypto IRAs on the market today. Storing and securing crypto for a regulated product like an IRA is very specialized, so only a few providers offer these services - they are listed in this article, along with feature set, fess and more to get investors started.

Q. What are the fees for a Crypto IRA?

A. Crypto IRA fees can range from company to company based on security, insurance, trading and support. Most crypto IRAs will have a holding fee, minimum monthly fee and trading fees. Security and fees are the most critical factors when selecting a company.

Q. What is the main advantage of a Crypto IRA vs. a public crypto index fund?

A. The main advantage is taxes. Crypto IRAs allow investors to defer capital gains taxes until withdrawal of funds. Buying a publicly traded crypto index fund with a regular brokerages account may be subject to capital gains tax when sold.

Q. How are crypto IRAs taxed?

A. They are taxed similarly to traditional IRAs. Taxes are paid once an investor reaches attainment of withdrawal age (59 ½ years). If withdrawn before then, a penalty is charged.

Why not just buy crypto directly instead?

Totally possible! But then the investor must hold the crypto and would pay capital gains taxes when it is sold.

Q. Is crypto IRA investing only in bitcoin or many cryptocurrencies?

A. Many managed crypto IRAs invest in a basket of cryptocurrencies. Some of them are bitcoin-only. Be careful while purchasing crypto-based funds. Many bitcoin funds are just that - no diversification investments in other cryptocurrencies. It's important to recognize that there are many other cryptocurrencies outside of bitcoin that could offer potential upside.