How to Add Bitcoin and Other Cryptos to an IRA 2022 7-26-22

How to Add Bitcoin And Other Cryptocurrencies to a Crypto IRA

Table of Contents 3 Introduction 4 What is Bitcoin? 7 Why is Bitcoin Popular? 10 Why Would You Want to Add Bitcoin to Your IRA? 13 Understand the Risks 15 Step One - Set Up Your New Cryptocurrency IRA 16 Step Two - Fund Your Cryptocurrency IRA 19 Step Three - Place Your Trades 21 Conclusion www.coinira.com 2

Introduction In just a short amount of time, Bitcoin has gone from a mere curiosity to a mainstay alternative investment. Long viewed with skepticism or a tool used by hackers and others engaged in nefarious activities, Bitcoin has erased those negative preconceptions and has taken the world by storm. Now over 80% of Americans have heard of Bitcoin and many of them hope to invest in it. With gains truly hard to grasp, Bitcoin started at $0.0008 and rose above $60,000 in just over a decade. Because of its longevity and the credibility bolstered by institutional investment, many investors are now looking to make Bitcoin a part of their retirement portfolio. www.coinira.com 3

What is Bitcoin? A Bitcoin Primer Bitcoin is a cryptocurrency that was created by a person or group of people going by the name of Satoshi Nakamoto and released to the public in 2009. It is a digital currency that uses cryptography to control its transactions, create new units of the currency, and verify transfers of the currency evidenced on the blockchain. www.coinira.com 4

In the case of Bitcoin, computers running the Bitcoin protocol, a computer program, perform the function of “mining,” the process of confirming Bitcoin transactions. When Bitcoins are transferred from one person to another, that transaction is sent to the Bitcoin network for confirmation. Multiple computers on the network join together to perform the cryptographic work necessary to confirm that those Bitcoins did in fact exist, that they did transfer from one account to another, and that those Bitcoins were not spent more than once at the time of said transaction. Once a transaction is confirmed by the network, the record of that transaction is recorded on Bitcoin’s blockchain, which registers every single Bitcoin transaction that has ever taken place. After a certain number of transactions have taken place, the block is sealed and placed onto the blockchain, and a new block is immediately created. At the creation of that new block, Bitcoin’s miners are rewarded with the creation of a certain number of new Bitcoins. Those Bitcoins can then be spent or transferred, and the whole process continues. The purpose behind Bitcoin’s creation was to create a form of digital cash that could be easily used by anyone, and that was superior to fiat currencies. Fiat currencies such as the US dollar rely on the trust that the central issuing authority will not create an unlimited amount of the currency. If they were to do that, the value of each unit of the currency would quickly plummet to zero. www.coinira.com 5

As we have seen with central bank monetary policy in the aftermath of the last financial crisis, that trust is often misplaced. Central banks will take advantage of their status as the central authority to create more and more money, benefiting governments and the banking system but eroding the purchasing power of the currency held by ordinary citizens. Bitcoin gets around the trust problem by decentralizing the issuance of currency, meaning there is no single or central authority that creates Bitcoins; they are a creation of the work of the Bitcoin network and the millions of computers running the Bitcoin protocol. One of Bitcoin’s features includes capping the number of Bitcoins created at 21 million, ensuring that Bitcoin’s supply remains limited and that users of Bitcoin can trust that, unlike central banks who can create money ad infinitum, no new Bitcoins will be created once that limit is reached. Bitcoin also allows users to deal directly with each other without having to go through the middleman of a bank or financial institution, referred to a \"decentralized finance\". That cuts down on both time and cost and overcomes the trust problem inherent with banks as well. When using the banking system, you have to trust that the bank you do business with won’t become insolvent, a periodic problem with fractional reserve banking that can lead to bank failures and bank runs. With Bitcoin, users can control their own funds and be their own banks. www.coinira.com 6

Why Is Bitcoin Popular? Adopters of Bitcoin realize they can transfer value almost effortlessly to anyone who has a Bitcoin wallet. Bitcoin was created to be a digital form of cash that could be used by anyone to t r a n s f e r v a l u e t o someone else, anywhere in the world. The first adopters of Bitcoin realized that by using Bitcoin they could transfer wealth almost effortlessly to anyone who had a Bitcoin wallet. That wallet can sit on a computer hard drive, a smartphone, or even a piece of paper. www.coinira.com 7

Just think of what it takes to pay someone by check. You write a check, the other person cashes it, then the bank takes a day or more to clear the payment with your bank before the money is available to you. Electronic payment systems like PayPal made that easier by allowing instant online transfers, but there was still the problem of clearing payment through banks, which could take up to several days. By contrast, Bitcoin transactions took place instantly and were cleared in minutes. Even more importantly, those transactions could take place across international borders, bypassing the cumbersome international bank payment systems that could take weeks to clear payments for individual consumers. As Bitcoin’s utility began to receive more appreciation, it gained more acceptance as a currency, although it was still relegated to person-to- person transactions. That all changed in January 2014 when Overstock.com began to accept Bitcoin as a payment for goods purchased on the company’s website. From that point on, more and more businesses began to accept Bitcoin as a payment, including Microsoft, Dell, Mastercard, and even Tesla. www.coinira.com 8

As more and more people began to use Bitcoin and more and more businesses began to accept it, the growing network effects spurred even greater demand for Bitcoin. That in turn caused the price to increase. We expect that as demand for Bitcoin continues to rise over the long term, Bitcoin’s price will continue to rise as well. December 2017 saw the introduction of Bitcoin futures trading, as both CBOE and CME Group began to offer Bitcoin futures contracts on their exchanges. That signaled an acceptance of Bitcoin’s mainstream status by regulators that augurs well for Bitcoin’s future. In April of 2021, cryptocurrency exchange, Coinbase Global Inc., briefly soared above $100 billion in its public trading debut, a valuation that gave more legitimacy to Bitcoin and the crypto world. The coming months and years should see even more widespread use and trading of Bitcoin. www.coinira.com 9

Why Would You Want to Add Bitcoin to Your IRA? Digital currencies like Bitcoin are the way of the future and have tremendous potential to increase in value long term. So Bitcoin is popular and you can use it to buy things, but why would anyone want to hold it in their retirement account? That’s a good question. www.coinira.com 10

So much of the financial world is already digitized. As cash use continues to decline and credit card use rises, as Internet retail continues to grow, and as smartphones keep saturating markets, more and more payments happen electronically. The average American today doesn’t receive a paycheck – their wages are normally deposited directly into a bank account. Only a tiny portion of that money ever sees the light of day as cash held outside their accounts. Utility payments, credit card payments, and many points of sale transactions all take place electronically. Contactless payments made with smartphones are reaching the mainstream as well. Digital payments and digital currencies are the way of the future, and Bitcoin looks to play a large and important role in that digital future. As popular as Bitcoin is becoming, it and the overall cryptocurrency market are still very much in their infancy. Early adopters have already made tremendous gains investing in cryptocurrencies, but many experts agree that it is not too late to take advantage of the potential crypto can offer. As cryptocurrencies become more established and gain mainstream acceptance, analysts agree that those who invest early will benefit most in the long run. Institutional acceptance is also growing. We have all heard stories about people who had the opportunity to invest in little-known startups such as Apple and Microsoft, but thought those companies would never amount to anything. How many more Americans will regret ignoring the potential of Bitcoin or other cryptos like Ethereum when they had the ability to get in on the ground floor? www.coinira.com 11

Maybe you’re one of the many Americans who saw their retirement portfolios cut in half during the financial crisis, and whose investments are slowly recovered using valuable time to just return to their original value. Maybe you’re still early in your career but looking for aggressive asset appreciation to develop a strong base for your retirement savings. Either way, Bitcoin has provided tremendous gains in value to many of its users. Bitcoin also offers investors a way to diversify their investment portfolios. A lot of people think that investing in small-, mid-, and large-cap stocks, plus a smattering of corporate bonds and Treasury securities is the epitome of a well-diversified portfolio. But that portfolio is completely dependent on the whims of financial markets. Just look at how financial markets reacted to the monetary stimulus that central banks introduced in the aftermath of the financial crisis. Bond markets boomed because central banks were buying up trillions of dollars worth of debt, pushing yields down and prices up. Stocks came to the party later, but they are benefiting too, with stock market prices having shot through the roof since 2016. But when central bank monetary stimulus ends, so will the boom market for stocks and bonds. That day may be closer than we think. True diversification therefore requires diversifying your portfolio across different asset classes. That means being open to investing in alternative assets, including cryptocurrencies such as Bitcoin, which many investors are now positioning as a hedge in their overall investment portfolios. www.coinira.com 12

Make Sure You Understand the Risks Your retirement funds are precious and determine your standard of living in retirement. Do your due diligence. As with all investments, investing in Bitcoin is not risk-free. While many people have made large amounts of money from investing in Bitcoin, gains aren’t guaranteed. Because Bitcoin markets are still relatively new and more thinly traded compared to more established financial markets, the price of Bitcoin experiences more volatility than many other assets. www.coinira.com 13

Swings of hundreds of dollars per day aren’t unusual in Bitcoin, and intra-day crypto price charts often look like a bit of a roller coaster. But if you are ready to diversify your retirement into cryptocurrency, and you have the patience to ride out short-term price swings, you can do so with the confidence that the IRS has paved the way for crypto in IRAs with their ruling that cryptocurrency is \"property\". As with any other retirement investment, investing in a Cryptocurrency IRA isn’t a get rich quick scheme – it’s a strategy to build wealth that you can draw on in your retirement. Before investing in Bitcoin, you may want to talk with your financial professional to make sure that you’re aware of and comfortable with the possible risks and to get some guidance on the best type of IRA for you. Cryptocurrency IRAs offer the same tax benefits that pertain to IRAs in general, and choosing the right type could save you thousands in income tax down the road. Once you have decided that cryptocurrency is the right investment for you, there are just three easy steps you need to take in order to put Bitcoin and other cryptocurrencies to work in growing your retirement portfolio. www.coinira.com 14

Step One - Set Up Your New Cryptocurrency IRA With Coin IRA's Digital Asset Trading Platform, your IRA can be set up in a few minutes. Once you decide a Cryptocurrency IRA is right for you, the first step is to set up your new account on the Coin IRA Cryptocurrency Trading Platform. You can easily do this yourself from the Coin IRA website or with the assistance of one of our Customer Support Specialists. The custodian for your new account will be Equity Trust Company, a self-directed IRA custodian uniquely qualified to support IRAs that hold Bitcoin and other cryptocurrencies. (Not all custodians are.) As you contemplate setting up your new Cryptocurrency IRA account, it's also time to start thinking about how you want to fund your new account and the amount you want to invest in cryptocurrency. Many investors begin by examining their current holdings to determine whether they have an existing cash balance they want to draw from or assets they wish to liquidate to fund their new account. www.coinira.com 15

Step 2 - Fund Your Cryptocurrency IRA Funding options include rollover, transfer, or eligible contribution. There are three ways to fund your Cryptocurrency IRA -- a rollover, a transfer, and an eligible contribution. The IRS code allows you to rollover funds from an existing 401(k) or other employer sponsored plan or transfer funds from an existing IRA to a like IRA, both without losing any of the tax benefits or triggering a taxable event, or by making all or part of your IRS allowable contribution for the year. Let's examine each option. www.coinira.com 16

Rolling Over a 401(k) or other Employer-Sponsored Plan to an IRA One of the easiest and most popular ways to fund a new Cryptocurrency IRA is a rollover from an existing 401(k) or other employer-sponsored plan, such as a 403(b) or Thrift Savings Plan. When changing jobs, many people choose to rollover the funds in their existing employer-sponsored plan to an IRA because it preserves the tax benefits and does not trigger a taxable event. Leaving an employer is the most common reason the funds in your plan become eligible for a rollover. Your current employer may also allow an \"in-service rollover\" when you reach the age of 59 ½ or older, even if you are still employed. The plan document lays out the specific rules that determine whether this is possible. A direct rollover sends the funds from your former employer’s plan directly into your new IRA, which you can then invest into cryptocurrency. Once your new IRA account is set up, the rollover request can often be accomplished online or with a phone call to your the plan administrator. Should you wish to move only part of the funds out of your employer-sponsored plan, you may request a partial rollover if the plan rules allow for that. Coin IRA's Customer Support Specialists are experienced in working with these kinds of plans, and with your cooperation can coordinate with the plan administrator to have the funds transferred directly to your new IRA account. www.coinira.com 17

IRA to IRA Transfer An IRA transfer involves sending funds from an existing IRA to a like IRA (Traditional to Traditional, Roth to Roth, SEP to SEP). This can also be a full or partial transfer of funds. The funds are sent directly from your existing custodian to your new IRA custodian, Equity Trust, after your new Cryptocurrency IRA account is established. If the funds in your existing account are fully invested, you need to convert the amount you want to transfer into available cash in your account before initiating the transfer. You should have a copy of your current account statement available to upload to the platform in order to verify the exact name on the account and account number. Eligible Contribution If you are working and earning income, you may be eligible to make a contribution to your new IRA as outlined in the IRS Code, based on your age and other factors. Check with your tax advisor to determine the type of IRA you should establish and the amount you can contribute. You can then make your eligible contribution or any portion of it from your earnings. Contributions can be made annually or broken into multiple deposits on a weekly, monthly, or periodic basis, as long as you don’t exceed the contribution limit for the calendar year. www.coinira.com 18

Step 3 – Place Your Trade Coin IRA offers self-trading and expert-assisted trades, depending on your preference. Once your new account is funded, you can either login to your account through the Cryptocurrency Trading Platform to place your own trades, or contact Coin IRA for assistance in placing your desired trades. The cryptocurrency you purchased is then transferred directly into your new IRA account, and any subsequent sale of the cryptocurrency held in your IRA works in the reverse. Trades settle the following business day, and you can check your account at any time online through the Coin IRA platform. www.coinira.com 19

Security is paramount when it comes to dealing with Bitcoin and other cryptocurrency. By design, any cryptocurrency sent from your wallet using your private keys is irretrievable, so accuracy is extremely important. With our platform, execution details are immediately provided once complete, and settle in your account the following day. Normally, the owner of the crytpo would be the only person who would have the private keys which enable cryptocurrency to be sent from a private wallet. However, in the case of a Cryptocurrency IRA, your custodian, Equity Trust Company, is required to hold your assets, and therefore the custodian secures your assets and is only authorized to send cryptocurrency from your IRA account when you place a sell trade with your written authorization or by authenticating you when you login to the platform to place your trades. Equity Trust guarantees the highest level of security and insurance to keep your digital assets secure. To date, there has never been a loss or breach of security related to cryptocurrency inside an IRA established through Coin IRA and Equity Trust. Equity Trust's custody of the digital assets in your IRA alleviates the worry of the complex technical aspects of storing cryptocurrency by providing 100% insured, world-class cold storage for your digital assets, the most secure storage option available. Custodians generally charge account fees for establishing and maintaining a Cryptocurrency IRA and storing the crypto on your behalf, but Coin IRA accounts are free. Only low transaction fees are incurred when you place trades and are clearly stated on your order summary prior to trade confirmation. www.coinira.com 20

Conclusion If you’re ready to invest in a Cryptocurrency IRA, it is advisable to establish your account now since it can take two to four weeks for your current custodian or plan administrator to process your transfer or rollover. Your Coin IRA Customer Service Specialist will be happy to answer any general administrative questions, however, questions pertaining to your specific tax situation should be addressed to your tax advisor. Call Coin IRA today at (888) 998-COIN to find out how you can make cryptocurrency a valuable part of your retirement portfolio. www.coinira.com 21

Call Us to Start Your Cryptocurrency IRA Today! (888) 998-COIN www.CoinIRA.com • [email protected] 21550 Oxnard St., 3rd Floor • Woodland Hills, CA 91367