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The increasing popularity of cryptocurrencies has sparked a question in many people’s minds. Should I invest in bitcoin for retirement? If you too are toying with the idea but not sure if it’s the right decision or simply don’t know how to go about it, you’ve come to the right place.

Read on to learn everything there is to know about investing in bitcoin for retirement and our top picks for the best Bitcoin IRA companies.

Bitcoin IRA Companies

The Best Bitcoin IRA Companies

There are several benefits of obtaining a Bitcoin IRA. They provide a secure, easy, and hassle-free way of investing in cryptocurrency for a retirement fund. 

Investing in Bitcoin can help diversify your investment portfolio. They hold potential for long-term gains and can help beat inflation. 

The most significant advantage of investing in Bitcoin through IRA is tax saving. If you invest in cryptocurrency directly, you must pay capital gains tax when you sell it at a profit.

However, if you hold it in your IRA, all the gains you make are shielded from taxation.

If you are considering obtaining a Bitcoin IRA, there are a few things you should keep in mind before doing so. Bitcoin IRAs can cost more to set up and operate as compared to other IRAs. 

You will also have to pay a fee for trading apart from the other costs. They have investment minimums, which can be fairly high. 

Be sure to evaluate Bitcoin IRA providers carefully on these aspects before making a decision.

Bitcoin IRA icon

Best Overall

Bitcoin IRA is one of the oldest and most well-established companies for cryptocurrency IRA trading. They offer an easy-to-use, turnkey service that doesn’t require you to create an LLC.

Bitira icon

Best for Security

BitIRA is a digital investment platform that helps you diversify your retirement portfolio with a crypto IRA.

iTrust Capital icon

Best Trading Platform

iTrustCapital is a beginner-friendly platform for crypto IRA trading that's more affordable than other companies. You can buy and trade both popular cryptocurrencies and physical assets like gold there.

What is Bitcoin IRA or Crypto IRA?

A Bitcoin or Crypto IRA is a self-directed individual retirement account that allows you to invest in Bitcoin and other cryptocurrencies. Your regular IRA enables you to invest in stocks, bonds, mutual funds, and exchange-traded funds.

However, it doesn’t allow you to invest in Bitcoins because the Internal Revenue Service (IRS) considers cryptocurrencies to be a type of property that is off-limits for your regular IRA. 

Therefore, you need to set up a separate IRA to invest in Bitcoin or cryptocurrency.

There are essentially three elements to a Bitcoin IRA or Crypto IRA account. A custodian holds your IRA and has to ensure that all government regulations are being followed.

Their role is similar to that of your bank or other financial institution that holds your regular IRA.

There is also an exchange, similar to the stock exchange, where cryptocurrencies, including Bitcoin, are traded. This is where you’ll make your purchases. Lastly, a secure storage solution to protect your cryptocurrency after purchase.

A Bitcoin IRA may offer all of the above elements on its own or partner with other organizations to provide some of these services to you.

Bitcoin IRA Reviews

Choosing the right Bitcoin IRA provider is a crucial decision. We researched several Bitcoin IRAs on factors such as security, experience, and fees to bring you our recommendations for the best Bitcoin IRA companies.

(Use our quick navigator below to find the best Bitcoin IRA provider that best suites your needs)


Bitcoin IRA icon

Bitcoin IRA

Bitcoin IRA is one of the oldest and most well-established companies for cryptocurrency IRA trading. They offer an easy-to-use, turnkey service that doesn’t require you to create an LLC..

Bitcoin IRA is our top pick for the best Bitcoin IRA company. It was established in 2016 and was the first IRA company to allow individuals to invest in cryptocurrency through their retirement accounts. 

It offers traditional, rollover, and Roth IRA accounts as well as a Bitcoin (401k). The account opening process is easy and takes only a few minutes. You can invest in Bitcoin, Ethereum, Ripple, Litecoin, Bitcoin Cash, and Ethereum Lite. 

Bitcoin IRA is the world’s largest processor of on-chain transactions and has over 2 billion in digital assets in its wallet. It accounts for 20% of all global Bitcoin transactions. 

The company takes security seriously. All digital assets are stored offline in cold storage accounts and are secured by a $100 million custody insurance from BitGo Trust. 

You can begin trading within three to five days of transferring the funds. The platform allows you to buy, sell, or trade 24x7. The minimum investment required to set up an account is $3000. However, there is no cap on investment.

The company is not transparent about its pricing structure. There is a one-time investment fee that depends on your initial investment amount. They also charge a custodian security fee and other charges on asset conversion, buying, and selling.

Pros

  • Easy to set up and fund an account.
  • Offline digital asset storage and insurance cover.
  • 24x7 real-time trading.

Cons

  • Non-transparent pricing structure.
  • Supports a limited number of cryptocurrencies.

Bitira icon

BitIRA

BitIRA is a digital investment platform that helps you diversify your retirement portfolio with a crypto IRA.

BitIRA takes the top spot for security. Though it started in 2017, the company has set itself apart by offering the highest security levels. They use multi-encryption coding for each of your investments.

They also offer proper cold storage. While offline, your funds are stored in grade 5 nuclear bunkers, so they are inaccessible to hackers and cybercriminals. No other digital IRA company offers this feature. 

BitIRA also offers end to end insurance coverage for your digital assets, and this insurance is comprehensive. It covers your assets right from their time of issue through transit and storage.

The company offers traditional SEP, Roth, and SIMPLE IRA accounts. It allows you to invest in Bitcoin, Bitcoin Cash, Ethereum, Ethereum Classic, Litecoin, ZCAsh, Stellar Lumens, and Bitcoin SV.

The account opening and set-up process are slightly longer here. It can take anywhere between a week to three weeks for your account to be ready to purchase cryptocurrency.

The fees charged by Bit IRA are also higher, owing to some of the security features they offer. They charge a $50 account set-up fee, $195 in annual maintenance charges, and 0.05% of your total assets per month in storage fee.

Currently, you need to invest a minimum of $5,000 when opening an account. They also charge a custodial fee which varies based on your account.

Pros

  • Proper offline cold storage of your assets.
  • Full insurance coverage.
  • Supports eight cryptocurrencies.

Cons

  • High account set up fees and maintenance charges.
  • 0.05% storage fee.

iTrust Capital icon

iTrust Capital

iTrustCapital is a beginner-friendly platform for crypto IRA trading that's more affordable than other companies. You can buy and trade both popular cryptocurrencies and physical assets like gold there.

iTrustCapital is our top choice for the company with the best trading platform due to its low cost and transparent fee structure, and easy-to-use interface.

Established in 2018, the company allows users to buy and trade cryptocurrencies and precious metals such as silver and gold through their retirement accounts. It offers traditional, Roth, and SEP IRA accounts.

Customers have a choice of investing in Bitcoin, Ethereum, Polkadot, Bitcoin Cash, Litecoin, EOS, Stellar, and XRP.

You can complete your IRA account application in minutes. Once you finish setting up the account, you can trade round the clock from your dashboard. All trades get executed in real-time.

You need to invest a minimum of $2,500 to set up your crypto IRA account. The biggest advantage of iTrustCapital is its transparent pricing and low fees. You need to pay a monthly account fee of $29.95 and a 1% trade fee.

The company has partnered with an institutional wallet provider named Curv to provide protection of digital assets through cryptography. Customer crypto assets are further protected by a $50 million insurance cover from Munich Re.

Pros

  • Transparent fee structure.
  • A low trading fee of 1%.
  • 24x7 trading platform.

Cons

  • High minimum investment.
  • Some popular cryptocurrencies are not available.

Bitcoin IRA Rules & Regulations

A Bitcoin IRA account can provide a host of benefits for your retirement investment planning. However, like any other investment account, Bitcoin IRAs also have specific rules and regulations. 

You must be aware of these and comply with them to enjoy the benefits that they provide.

Here are some of the critical rules & regulations:

Withdrawal

The purpose of IRA accounts is to help you save and grow funds that you can use once you retire. While Bitcoin IRA accounts invest in a different asset class, their purpose is the same as any other IRA. 

According to rules, you can spend or withdraw funds from an IRA account once you reach the retirement age of 59 ½ years. Withdrawing funds from your Bitcoin IRA before retirement will result in penalties. 

There are some cases where you may be allowed to make a withdrawal from your IRA without a penalty. These include first-time home purchases, educational expenses as well as medical expenses. 

If you’re looking for an investment account that you can dip into over the years, a Bitcoin IRA may not be the best idea. You can sell your Bitcoins or other cryptocurrencies as long as you reinvest in your IRA.

Taxation

Tax saving is one of the most significant advantages of investing in Bitcoin through an IRA. You don’t have to pay any taxes on the gains that you make on your digital assets as long as you hold them in your IRA. 

You only have to pay taxes on the funds that you withdraw when you withdraw them. However, be sure to account for these taxes and pay them before you spend any of the money you withdraw from your Bitcoin IRA.

Investment Limits

In terms of investment limits, Bitcoin IRAs are similar to traditional IRAs. You can set up an account with any amount of funds. However, there are annual contribution limits put in place by the IRS. 

You can only contribute $6,000 for 2020 and 2021. This amount goes up to $7,000 if you are aged 50 or older.

Benefits of Having Bitcoin IRA

Like other retirement accounts, Bitcoin IRAs offer several benefits such as:

1. Tax-free Growth

As long as you hold your Bitcoins or other cryptocurrencies in your Bitcoin IRA, the gains are shielded from taxes. You only pay taxes when you withdraw the funds and on the amount that you withdraw.

If you open a Roth Bitcoin IRA, your gains are tax-free.

2. Security

All transactions made through your Bitcoin IRA accounts are secured through multiple encryption levels and subjected to the highest security protocols. Bitcoin IRA providers also ensure offline cold storage of assets and insurance covers for additional security.

3. Diversification

Bitcoins are a great diversifier since they do not correlate to stocks, bonds, or mutual funds, some of the most commonly held assets in retirement accounts.

4. Capital Appreciation

Bitcoins and other cryptocurrencies hold the potential for significant gains over time. While it is a volatile asset class, they have sown returns that have outpaced other markets. 

5.  Limit Inflation

Given that digital currencies have a fixed upper limit, it is not possible to inflate supply artificially.

FAQ's

If you still have a few questions, it's ok. We have you covered with this list of frequently asked questions.

Where is my Cryptocurrency Stored?

Cryptocurrency is stored in a digital wallet. It is software that holds the coded keys associated with your bitcoin addresses. 

What Is a Bitcoin Exchange?

A bitcoin exchange is similar to a stock exchange. It is a virtual marketplace where people can buy and sell bitcoins in exchange for other currencies.

How Can I Protect My Cryptocurrency IRA?

You can take several steps to protect your cryptocurrency IRA. Set up a separate email account for your crypto transactions and make sure the password is extremely strong. Do not share your password with anyone or store it in places where others can access it.

Do not discuss your Crypto IRA details in any forum where hackers or cybercriminals may access it. Store your assets offline in cold storage until you are ready to sell.

What Is a Self-Directed IRA?

A Self-Directed IRA is a type of individual retirement account managed directly by the account holder. It allows them to invest in alternative asset classes that traditional IRAs do not offer.

What Is an IRA Custodian?

It is a financial institution that holds your investments and is responsible for adhering to the IRS and government regulations.

Is Cryptocurrency Viewed as a Retirement Asset by the IRS?

The IRS considers cryptocurrency in retirement accounts as property. Hence, it is taxed in the same way as stocks or bonds. There is no mention of cryptocurrency under regulations listed for Self-Directed IRAs.

How to Invest in a Bitcoin IRA

Here are the steps you need to take to invest in a Bitcoin IRA:

Step #1: Choose a Bitcoin IRA Provider

Several companies now offer Bitcoin IRA accounts. The first step is to research these companies and evaluate the benefits they provide and the costs associated with them. Choose the one that is best suited to your needs and budget.

Step #2: Begin Rollover or Transaction Process

Once you’ve finalized your Bitcoin IRA provider, you need to set up an account with them. This process is fast and straightforward. You can then fund this new account through a rollover, transfer, or cash contribution. 

Step: #3: Invest in Bitcoin or Crypto

Depending on your provider and the funding process, it can take between three days to three weeks for your account to be ready for transactions. Once it is ready, you can invest in Bitcoin or any other cryptocurrency offered by your company.

Next Steps

A Bitcoin IRA can be a great way to invest in cryptocurrency for retirement. It offers an easy way of diversifying your investment portfolio and the potential for capital appreciation along with tax advantages.

It is crucial to choose the right Bitcoin IRA provider that matches your needs and suits your budget. Research the various options available and evaluate them on factors such as security, fees, and user experience.

With our list of recommendations for the best Bitcoin IRA companies, you are sure to find one that can help support your retirement investment needs. Check any of these companies out today.

Our top pick: Bitcoin IRA

Bitcoin IRA icon

Bitcoin IRA

Bitcoin IRA is one of the oldest and most well-established companies for cryptocurrency IRA trading. They offer an easy-to-use, turnkey service that doesn’t require you to create an LLC..


Tags

bitcoin, investing


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About the author 

Donny

I’m Donny. I can sum myself up with four simple ways. Online Entrepreneur. Author. Investor. World Traveler

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