I'm 45 With a Roth IRA and Want to Invest in Cryptocurrency. What Do I Need to Know?

Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below. Holding cryptocurrency inside a Roth IRA is legal, and for some investors the structure is genuinely compelling. Crypto gains inside a Roth IRA are tax-free if you follow the rules, which means a position that grows 300% doesn’t generate a capital gains bill the way it would in a taxable brokerage account. But most major custodians, including Fidelity, Vanguard, and Schwab, don’t offer direct crypto exposure. Getting it requires a self-directed Roth IRA. The IRS has never issued a ruling that explicitly bans cryptocurrency in IRAs. What the IRS has clarified is that cryptocurrency is treated as property for tax purposes, per IRS Notice 2014-21. Property can be held inside a self-directed IRA, the same way real estate or private equity can. The key is having a custodian that allows it and a proper structure for holding the assets. Don't Miss: Real estate. Crypto. Private deals. Most retirement accounts don't allow them — self-directed IRAs do . Find out if your retirement plan is exposed to risks most investors overlook — get matched with a fiduciary adviser today. Checkbook Control and LLC Structures One common structure for crypto investing inside an IRA is the checkbook IRA LLC. Your self-directed IRA invests in a single-member LLC, which you manage as the manager. The LLC then opens a dedicated crypto exchange account or digital wallet. Because you control the LLC, you can transact without waiting for custodian approval on each trade, which matters a lot in a volatile market where timing can be meaningful. The checkbook LLC structure requires careful setup to avoid prohibited transaction issues. You manage the LLC but you cannot personally benefit from it. That means no borrowing from the LLC, no transacting with disqualified persons through it, and no commingling of LLC funds with personal funds. The Prohibited Transaction Risk Is Real The IRS has challenged certain checkbook IRA structures where the account holder blurred the line between managing the LLC and personally benefiting from it. A 2023 Tax Court decision reinforced that simply acting as manager of an IRA-owned LLC does not automatically constitute a prohibited transaction, but the facts and circumstances of each arrangement matter. The structure needs to be clean from the start. Trending: Tax-advantaged Bitcoin investing exists — and Bitcoin IRA has helped 170,000+ clients do it, with 60+ cryptocurrencies and seamless IRA and 401(k) rollovers. Volatility and the IRA Context Crypto’s volatility cuts both ways inside an IRA. A position that falls 70% is painful in any account, but inside an IRA there’s no tax-loss harvesting benefit to offset gains elsewhere. You can’t deduct IRA losses the way you can losses in a taxable account. If you’re allocating crypto to a Roth IRA, sizing the position conservatively, say 5% to 15% of the account, preserves the core of the account while giving you meaningful upside exposure. Contribution Limits Cap How Much You Can Put In The 2025 Roth IRA contribution limit is $7,000 ($8,000 if you’re 50 or older), subject to income phase-outs starting at $150,000 for single filers. If you already have a Roth IRA at a traditional custodian, you can’t simply add crypto to it. You’d need to open a new self-directed Roth IRA and either make fresh contributions or convert existing Roth funds by rolling them to the new account. A Roth-to-Roth rollover is tax-free. See Also: Crypto and stocks on one platform, trusted since 2011 — Kraken offers 600+ crypto pairs and 11,000+ stocks and ETFs Custodial Fees in This Space Vary Widely Some self-directed IRA custodians charge a percentage of assets, which creates a perverse dynamic: the more successful your crypto investment, the more you pay in fees. Others charge flat transaction or account fees. For volatile assets like crypto where the account balance can fluctuate dramatically, a flat-fee structure is almost always more cost-effective over time. IRA Financial offers self-directed Roth IRA accounts that support cryptocurrency and other alternative investments through a checkbook control structure. For a 45-year-old with a 20-year horizon before traditional retirement age, the combination of a Roth IRA’s tax-free growth and direct crypto ownership is worth investigating seriously. Crypto inside a Roth IRA is one of the few ways to capture significant gains in a highly volatile asset class without owing the IRS a portion of every successful trade. Read Next: The IRS Could Take A Bigger Bite Out Of Retirement Savings Than Many Expect — Some Investors Are Seeking Professional Help Building Wealth Across More Than Just the Market Building a resilient portfolio means thinking beyond a single asset or market trend. Economic cycles shift, sectors rise and fall, and no one investment performs well in every environment. That's why many investors look to diversify with platforms that provide access to real estate, fixed-income opportunities, precious metals, and even self-directed retirement accounts. By spreading exposure across multiple asset classes, it becomes easier to manage risk, capture steady returns, and create long-term wealth that isn't tied to the fortunes of just one company or industry. Arrived Backed by Jeff Bezos, Arrived Homes makes real estate investing accessible with a low barrier to entry. Investors can buy fractional shares of single-family rentals and vacation homes starting with as little as $100. This allows everyday investors to diversify into real estate, collect rental income, and build long-term wealth without needing to manage properties directly. Immersed Immersed is building technology for the future of work through spatial computing. Known for its AR/VR productivity platform that enables users to work across multiple virtual screens, the company has grown to more than 1.5 million users worldwide. Immersed is also developing Visor, a lightweight headset designed specifically for professional productivity, positioning the company at the intersection of remote work, extended reality (XR), and next-generation computing. Vinovest Fine wine and rare whiskey have historically moved independently of the stock market, making them a compelling alternative asset. Vinovest manages authenticated, insured portfolios of investment-grade wine and whiskey starting at $5,000 — sourcing, storage, and insurance all handled for you. EnergyX EnergyX is a clean energy technology company focused on direct lithium extraction and refinery technologies for the lithium-ion battery supply chain. Its proprietary DLE systems are designed to recover lithium from brine resources more efficiently and with less environmental impact, supporting efforts to expand lithium supply for electric vehicles, grid-scale storage, and other battery applications. FarmTogether Farmland has historically held its value through market volatility and delivered returns uncorrelated to stocks and bonds. For accredited investors, FarmTogether offers direct access to high-quality U.S. farmland starting at $15,000 — fully managed, with no landlord headaches. EquityMultiple For accredited investors looking beyond stocks and bonds, EquityMultiple provides access to vetted commercial real estate deals starting at $5,000, with only ~5% of opportunities passing their due diligence process. Fundrise Private real estate and private credit can add income and stability to a stock-heavy portfolio. Fundrise offers access to diversified private real estate and credit strategies through an easy-to-use platform, with professionally managed portfolios designed to generate passive income and long-term growth. American Hartford Gold American Hartford Gold is a precious metals dealer that helps clients buy physical gold and silver coins and bars, either for direct delivery or within self-directed precious metals IRAs. The company's services include gold and silver IRAs, IRA rollovers, and home delivery of bullion, giving investors a way to use tangible metals to diversify portfolios and seek protection against inflation and market volatility. Image: Shutterstock This article I'm 45 With a Roth IRA and Want to Invest in Cryptocurrency. What Do I Need to Know? originally appeared on Benzinga.com © 2026 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.