What do Tom Brady, Joe Rogan, Mel B, and New York City’s mayor-elect have in common? They’re among the first in their professions to be paid in Bitcoin (or at least partially).
But it’s not just celebrities who are embracing Bitcoin and other cryptocurrencies. Over the past year, more than 1 in 10 Americans traded crypto. What’s more, 61% of those who got into crypto did so in 2021. The past year has seen a massive flood of interest in crypto, from high school students to investment bankers, hedge funds, and even countries.
Everyone, it seems, has crypto on the brain.
We call it “cryptobrain,” and it’s the theme of Alto’s first national TV campaign.
What Is Cryptobrain?
You’ve probably read or heard the phrase crypto-curious used to describe someone who is just getting interested in crypto. We’ve been using it for quite awhile, but it didn’t feel like the right word for the now-millions of people for whom crypto is far more than a curiosity.
We should know, too… At Alto, our mission is to make tax-advantaged investing in alternative assets accessible to everyone—not just the wealthy. So it would only make sense that some of us are more interested in one particular asset versus others. Considering the explosive growth of crypto over the past decade, you can bet that quite a few of us are admittedly a bit crypto-obsessed.
We see things like supply chain shortages or intellectual property rights issues and think, “Blockchain could fix this.” We’ve read the Bitcoin white paper. (Which, if you’re interested in crypto, is a good place to start.) When we talk about buying the dip, you can rest assured we’re not talking French onion. Some of us may have even considered a trip to El Salvador just for the experience of buying a Big Mac with BTC—though we’ll probably just HODL instead.
If any of the above sound familiar, you, too, might have a case of cryptobrain. Fortunately, unlike a case of the Mondays—which only leads to Tuesday (and who wants that?)—there is something you can do about it.
Introducing Alto CryptoIRA®—the tax-advantaged way to buy, sell, and trade crypto using retirement funds. CryptoIRA gives you access to 200+ coins and tokens, with no setup or monthly account fees, $10 investment minimums, and 24/7 real-time trading.
Watch “Cryptobrain” here, and then follow us on social media to share your own examples. (NOTE: We now offer access to 200+ coins and tokens through integration with Coinbase.)
How Does Crypto in an IRA Work?
Whether you’re an every day, hardcore HODLer, or an occasional investor, there are major advantages to crypto in an IRA. Just consider how an IRA works…
IRAs, or individual retirement accounts, were created with special tax advantages to encourage Americans to invest for the future. In particular, investments made within IRAs grow free from capital gains taxes. Rather, with an IRA, you either:
- Make contributions using pre-tax money but pay income tax on eligible distributions (traditional and SEP IRAs).
- Make contributions using after-tax money but never pay taxes on eligible distributions (Roth IRA).
What constitutes an eligible distribution? All IRAs require you to wait until six months after turning 59 to take distributions, with a few exceptions. Additionally, to take distributions from a Roth IRA, you must also have had the account for at least five years.
It’s also important to note that while traditional and SEP IRA account holders must begin taking required minimum distributions (RMDs) at age 72, Roth IRA holders are not required to take distributions.
An Alto CryptoIRA can be set up as a traditional, SEP, or Roth IRA. Which is best for you depends on a number of factors, including your current income, anticipated income at the time of withdrawal, anticipated tax rate at the time of withdrawal, etc. Also consider that Roth IRAs have set income cutoff limits, meaning you may be ineligible to contribute to a Roth—rollovers, however, are still allowed.
Important note: A SEP IRA is one that is offered and funded by an employer and has different contribution limits. While the contribution limits exceed those of traditional and Roth IRAs, they work like traditional IRAs when it comes to taxes.
Got Your Eye On Crypto?
Get it tax-advantaged with Alto CryptoIRA. Create an account today and start investing in crypto with as little as $10.
Alto is an administrator of IRAs, is not a fiduciary, and does not provide investment advice. Nothing herein shall be construed as financial, legal, or tax advice or a recommendation or solicitation of any particular investment, security or cryptocurrency. All information in this article is solely for information purposes. Investors are responsible for conducting their own due diligence regarding all self-directed IRA investments.