Cryptocurrency in an IRA
Last Updated on 17th June 2022 by Jeffrey Camerda
Investing in Cryptocurrency with an IRA is an excellent way of diversifying your account. It is also a surprisingly easy process to complete. Just set up a new self-directed Cryptocurrency IRA and rollover as much of your existing funds as you want. You can then begin purchasing bitcoin/cryptocurrency. You’ll need to hire a secure custodian to manage the private keys and the account on your behalf.
Investing a percentage of your IRA in cryptocurrency is an excellent way of diversifying your retirement portfolio and future-proofing your investment. The process of rolling over from a regular IRA to a bitcoin IRA couldn’t be more straight forward. All you need to do is set up a Self Directed IRA account and roll your funds over from your traditional IRA.
There are a host of companies out there that will facilitate this process for you and manage the account on your behalf once it is set up. Cryptocurrencies such as bitcoin are still in their early days and offer a very exciting investment opportunity. Also, as they exist outside the traditional banking system they may be an attractive option for people concerned about being hit hard by the next global banking crisis.
Why Invest my IRA in Cryptocurrency?
Given the uncertain economic and political climate we currently live in channeling some of your investment away from the traditional asset class and into the likes of bitcoin could be a very smart move.
Financial experts are warning that the next global financial collapse is just around the corner. In 2020 the US national debt stands at an incredible $23 Billon. It is spiraling and has quadrupled in size in the last 20 years. The indicators are there and it’s time to start thinking about where you want your investment to be when the house of cards comes tumbling down.
When considering cryptocurrency investment options it is important to do some research and choose the currency that works best for you. There are a lot of virtual currencies out there so it’s worth taking some time to weigh up the pros and cons and choose the best investment option for you.
Bitcoin is the most established cryptocurrency on the market today and is the favored option for many. Below we’ll take a look at the key factors that make Bitcoin so popular.
- Autonomy: One of the main advantages of bitcoin is that it can be used with complete autonomy. Bitcoin allows the user to control how they spend their money without requiring the intervention of a bank or financial institution to facilitate the transaction.
- Greater Privacy: Transactions are discrete. If a user does not publish his transaction it is very difficult to trace it back to his individual identity.
- Global Reach: Bitcoin allows users to send or receive money anywhere in the world. It has no geographical restrictions. The network can be accessed using any internet-enabled device.
- Security: Transactions are secure and irreversible thanks to the blockchain technology employed. Both the sender and receiver are protected from fraudulent activity. This is a big advantage compared to traditional credit cards. The blockchain’s historic data can never be deleted or amended. It is a permanent record.
- Quick Verification: Transactions can be verified without having to rely on third parties.
- Low Transaction Fees: intermediaries such as banks are removed and so too are their significant fees. Transfer fees for bitcoin are very low, typically just 0.0005 of one bitcoin.
- No Upper Limit: It has no maximum value limit on any given transaction. Any sum of money can be processed in a single transaction.
- No Time Restrictions: There are no day or time restrictions as can be the case with banks. Transactions can be processed at any time of the day 365 days per year.
Cryptocurrency IRA Companies
If you decide to open an IRA that allows you to invest in cryptocurrency the best way to do it is by engaging the services of a specialist IRA custodian. There are several IRA companies out there that specialize in setting up and managing cryptocurrency IRAs.
These people are professionals and can help you get the account up and running very quickly and make sure you avoid any hidden pitfalls. Each one offers something different in terms of key strengths, fee structure, and levels of experience and expertise. I’ve done some research on the companies out there and it appears the top four companies are: Regal Assets, BitcoinIRA, BitIRA, and Noble Bitcoin. Spend some time assessing your options and pick the one that is the best fit for you. Among the points to consider for each one is:
- Experience & Expertise: It’s best to look for a custodian that has a proven track record in managing crypto-asset IRAs. You want to work with someone that knows what they are doing and has a team of people that can confidently navigate the world of virtual currency. Some of the custodians are more experienced than others when it comes to managing cryptocurrency IRAs.
- Ratings & Feedback: Take a look at the ratings for each of the custodians. There are several business rating scores, eg: the Business Consumer Alliance and Better Business Bureau, that can give you an idea of how the company is performing. Also, you can take a look at the feedback it is getting from its existing customers. This will give you an idea of how the company is performing.
- Assistance with Account Creation: Some companies can help you rollover an existing IRA into a self-directed IRA which is required to invest in cryptocurrency. The best custodians claim they can have you up and running in just 24 hours. It’s worth checking what assistance will be provided during rollover and account creation if you want your account set-up quickly.
- Security: When it comes to cryptocurrency security is critical. Your investment will be held in virtual form, a series of ones and zeros. You need to be able to rest assured that it is safe and will not be hacked or stolen. You should be looking for companies that provide secure offline cold storage and multi-sig features for account access.
- Ease of Transactions – Buying & Selling: Depending on how you plan to manage your investment this feature may or may not be important to you. You may want to invest a lump sum in bitcoin and leave it sitting there playing the long game. However, if you plan to trade on the crypto market as you identify opportunities you will need to be able to process transactions quickly and easily. In this scenario, you want to be able to buy and sell currency and avoid delays and difficulties.
- Fee Structure: Each of the custodians offers something slightly different when it comes to fee structure. I’ve done a little research on this but when it comes to published information fee transparency could be better. Some charge a flat fixed fee for managing an account while others charge a percentage-based fee based on the value of the investment. To get a clear breakdown of fees from a custodian you will need to contact them directly and make a personal inquiry.
Cryptocurrency IRA Reviews
There are several Cryptocurrency IRA custodians out there but four really stand out from the rest. We’ll take a quick look at each one and highlight their unique selling points.
1: Regal Assets
Regal Assets are right up there when it comes to crypto IRA companies. They were the very first company to get a global crypto commodity trading license. They offer investment in not just bitcoin but in 35 different virtual currencies. Their virtual account management platform the ‘Regal Wallet’ facilitates quick, easy, and highly secure cryptocurrency trading. They provide full insurance cover on investments and they score very highly in terms of ratings and customer feedback. Among their key strengths are:
- Excellent Industry Experience: they are industry leaders in managing cryptocurrency IRAs. They have a strong team of specialists that can advise and assist the running of your account.
- Industry Ratings & Reviews: they perform incredibly well when it comes to ratings & reviews. They hold a Triple “AAA” Business Consumer Alliance score and an “A+” with the Better Business Bureau. They also have over one thousand “5-star” reviews on TrustLink.
- Secure Asset Storage: all investments are stored separately in what is called segregated, cold storage. This means your crypto assets are not pooled in alongside someone else and they are stored securely offline out of reach of hackers.
- Investments are Fully Insured: investments with Regal are insured to the full market value of the asset.
- 35 Cryptocurrencies: they offer investment in 35 different cryptocurrencies. This is much more than their leading competitors and represents an excellent range of investment options.
- Precious Metals: they offer investments in precious metals alongside cryptos, including gold, silver, platinum, and palladium.
BitcoinIRA was another of the first bitcoin IRA companies formed. It was launched in 2016 and they have accumulated a wealth of experience when it comes to investing in crypto. They actually facilitate investments in six virtual currencies and not just Bitcoin as their name may suggest. Among their key strengths are:
- Cryptocurrency Specialists: they specialize in cryptocurrency investments and do not offer any other type of investment. As such, they can be considered experts in the field.
- Ratings & Reviews: BitcoinIRA scores well when it comes to online ratings and reviews although they may not be scoring as highly as rivals Regal. Feedback, however, is still generally good.
- 6 Cryptocurrencies: they facilitate investments in six of the leading virtual currencies: bitcoin, ethereum, ethereum classic, bitcoin cash, litecoin, and ripple.
- Secure Storage: assets are stored securely using offline cold storage and multi-signature digital wallets.
- Minimum Investment $3,000: the minimum investment needed to open an account is just $3,000.
- Investments are Insured: all investments can be insured thanks to their partnership with Lloyd’s of London.
BitIRA was created back in 2017 by precious metals dealers Birch Gold Group. The Birch Gold Group has been dealing in precious metals since 2003. They specialize in gold, silver, platinum, and palladium. They have received generally positive ratings from both the Business Consumer Alliance and the Better Business Bureau. However, they require a minimum investment of $20,000 to open an account. This is pretty high compared to its competitors. Among their key strengths and points to note are:
- Secure Storage: all cryptocurrency assets are stored offline in a guarded vault.
- Positive Ratings: they have received generally positive ratings from both the Better Business Bureau & Business Consumer Alliance.
- No Selling Fees: they do not charge a fee when selling cryptos.
- 8 Cryptocurrencies: they support investment in eight of the leading currencies.
- Insurance: insurance cover is available for all investments.
- Minimum Investment: Not quite a strength, more a distinguishing feature, but a minimum investment of $20,000 is required to open an IRA account.
4: Noble Bitcoin
Noble Bitcoin was also formed back in 2016. It is a branch of the well known and reputable company Noble Gold Investments. Noble Gold is a precious metals IRA firm and is well respected within the industry. Noble Bitcoin offers IRA investments in four cryptocurrencies: bitcoin, ripple, ethereum, and litecoin. Among their key strengths and points of note are:
- IRA Experience: although Noble Bitcoin is a relatively new division within Noble Gold Investments the parent company has been managing IRA portfolios for over 25 years. They are well trusted by their customers and have a good name in the industry.
- 4 Cryptocurrencies: they offer investments in four of the leading cryptocurrencies – bitcoin, ethereum, ripple, and litecoin.
- Quick Set-Up: once your application has been completed they can have your cryptocurrency IRA up and ready to go in just 5 minutes.
- Security: your IRA crypto assets will be securely stored offline in cold storage.
- $20,000 Minimum Investment: compared to their competitors this is a pretty large figure. You will need to be willing to invest at least $20,000 to get your cryptocurrency IRA set up.
For more reading on custodian companies, see our guide to the Best Cryptocurrency IRA Companies 2020 – here.
Best Cryptocurrency IRA
Weighing up the pros and cons of each of the four custodian companies it is clear there is some healthy competition in the cryptocurrency IRA market. All for offer a similar service when it comes to account set up, secure storage of assets, and insurance cover on investment. The main differences separating the competitors can be found in:
- Experience: Noble and Regal come out on top. BitcoinIRA and BitIRA are relatively new to the market compared to the two more established competitors. Noble Gold Investments has over 25 years of experience in the IRA industry and has a good name. Regal Assets also has a more established track record having been managing IRAs since 2009. They were also the first company to receive a global crypto commodity trading license.
- Range of Cryptocurrencies: Regal are the clear winners here. They support investments in 35 cryptocurrencies, putting them head and shoulders above the competition. Noble comes out on the bottom here with support for just 4 virtual currencies. BitcoinIRA and BitIRA offer investments in 6 and 8 virtual assets respectively.
- Ratings & Reviews: Regal Assets and Noble both score very well here. Being the two better-established companies they both have a wealth of online feedback available from their customers. Regal comes out on top here as well with a Triple “AAA” Business Consumer Alliance score, an “A+” rating with the Better Business Bureau, and over one thousand “5-star” reviews on TrustLink.
- Minimum Investment: Regal Assets and BitcoinIRA edge the competition here. Accounts can be opened with sums of $5,000 (Regal) and $3,000 (BitcoinIRA). BitIRA and Noble Bitcoin require a minimum investment of $20,000. This may represent a hurdle to some. Regal Assets and BitcoinIRA accounts are more accessible.
- Alternative Investments Options: Regal Assets, Noble and BitIRA offer investments in precious metals as well as cryptos while BitcoinIRA customers are limited to cryptocurrencies only. The precious metal options may be an attractive alternative asset to investors who would like to diversify their portfolio.
All things considered, I think Regal Assets edge it. They offer the best overall cryptocurrency IRA management experience. While each of the custodians offers something different and each has its own strengths, Regal Assets offer the best overall package. They outperform their competitors overall when analyzing the key factors: industry experience, range of investment options, industry ratings/customer reviews, and minimum investment required.
Regal Assets Crypto
Regal Assets are one of the world’s leading cryptocurrency IRA investment custodians. They offer investment options in 35 of the leading virtual currencies on the market – much more than their competitors.
The company was established back in 2009 and has built a solid reputation over the years. They have been awarded a triple “AAA” Business Consumer Alliance score, an “A+” rating from the Better Business Bureau, and have over 1,000 “5-star” reviews on TrustLink.
Regal Assets is the highest-rated alternative assets firm in the US. They have received recognition from Forbes, the Huffington Post, Smart Money, and many others. They have been ranked number 20 in the country by INC 500 in the financial services category.
The company has been featured in several major business publications such as Forbes, SmartMoney, Reuters, Market Watch, and the Hollywood Reporter. They also offer investments in precious metals, (gold, silver, platinum, and even palladium), which may be an attractive option for investors that would like to diversify their portfolio.
For more information on your options on cryptocurrency IRA accounts – click here.
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Dr. Jeffery Camerda, PhD, is a financial planner who specializes in wealth management and retirement planning.
With a PhD in Economics and Financial Planning, Jeffery represents the highest level of financial planning expertise and achievement in the USA
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Jeffrey Camarda, PhD, CFA, EA is also the founder of the Family Wealth Education Institute, is a member of the Financial Planning Association and serves as the Chairman of Camarda Wealth Advisory Group