Wall Street Unplugged
Episode: 932August 11, 2022

How to make Bitcoin a part of your retirement plan

Chris Kline Bitcoin IRA

Chris Kline, co-founder and COO of Bitcoin IRA joins me for a can’t-miss discussion on holding cryptos in your retirement account, crypto volatility, security and compliance, and future crypto regulations.

Chris shares how he became interested in cryptocurrencies… what led him to start Bitcoin IRA… whether Bitcoin (BTC) is an inflation hedge… and what attracts investors to cryptos.  

Plus, he explains how to open an account with Bitcoin IRA—a unique platform that lets you invest in over 60 cryptos in a tax-free retirement account.

Learn why Chris is so passionate about educating clients… and the steps Bitcoin IRA has taken to make the process secure, transparent, and as easy as any other brokerage account…

Inside this episode:
  • The creation of Bitcoin IRA [2:15]
  • What drives investors to BTC? [6:50]
  • How to open an account with Bitcoin IRA [8:50]
  • Will big brokerages dominate Bitcoin investing? [18:15]
  • Are cryptos securities? [25:30]
  • Which cryptos will thrive going forward [29:05]

Wall Street Unplugged | 932

How to make Bitcoin a part of your retirement plan

Announcer: Wall Street Unplugged looks beyond the regular headlines heard on mainstream financial media to bring you unscripted interviews and breaking commentary direct from Wall Street right to you on main street.

Frank Curzio: How’s it going out there? It’s August 11th. I’m Frank Curzio, host of the Wall Street Unplugged podcast, where I break that headlines and tell you what’s really moving these markets. AI have a great guest for you today. His name is Chris Klein, who is the COO and Co-Founder of Bitcoin IRA. Chris, an awesome guy, has been investing in crypto since 2013, 2014. And he created this company all the way back in 2015, which allows anyone to invest the IRAs, Roth IRAs, 401(k)s into Bitcoin and other cryptocurrencies. I know that might sound crazy since the heavyweights with trillions of assets, were seen in the media, are trying to penetrate this market and allow the clients to invest at least a small percentage of their retirement funds into Bitcoin, Ethereum, and other top cryptos. This is going to be a fascinating interview. After you give it a listen, you’re going to have the full playbook on how to invest a portion of your IRA or retirement funds into this alternative asset class. I’ll let Chris do the rest of the talking. And here’s that interview right now. Chris, thanks so much for coming on Wall Street Unplugged.

Chris Klein: Thanks for having me today. A long time listener, first-time caller. I’m so excited to be here.

Frank Curzio: That’s awesome, that’s awesome. So listen, we got a lot to talk about because you started a company, Bitcoin IRA, and this isn’t something that’s recent. We’re hearing about Fidelity trying to get into this and wants to allocate as much as 20% which I said, “That might be a little too much,” and I am a huge fan of Bitcoin as you know of being a podcast listener in cryptos. Also, we saw BlackRock recently with Coinbase. We’re seeing more assets, especially in the institution come in, but you’ve been doing this for a really, really long time. Why don’t we talk about that? You’ve been in crypto, I want to say before 2015. You look at Bitcoin probably around 200, $250 back then. What made you jump into this market? What have you seen change for maybe the positive and negative up to this point? And then we’ll get into Bitcoin IRA, which is a fascinating company.

Chris Klein: Absolutely. My partners and I have been working in self-directed IRAs for alternative investments for years. So real estate, LLCs, private equity, precious metals. The challenge of putting Bitcoin in one of these came across our desk in the winter of 2015, and so we explored it. Most of us didn’t know hardly anything about Bitcoin at the time. What I have loved watching in this industry since then is not… I mean, obviously, the volatility you got to have some intestinal fortitude for it, but you also get used to it over time. It’s standard, it’s part of the process. But the innovation that happens. One thing that really caught my eye over the weekend was some statements that Vitalik said, Buterin said about Ethereum, that eventually, the system will run itself. That’s part of what just makes this space so beautiful is that’s the mentality of crypto, folks, is I’m building something for generations to come that will really change the way we look at things. That’s one of the biggest things I love about it.

Frank Curzio: Take us through the ups and downs. Because when you first got in, in 2015, you’re probably like wow, this is a good idea. You were probably digital gold in 2011, even before that, right, so I mean, you’ve been really in this market. Then you see 2016 and ’17 and you’re like wow, we’re in the right area. Then, of course, you see the crash, right, and then you see the ups and downs. What are your thoughts on what’s coming down the line? Because the fact that you’re able to establish this, and everybody’s after you, I feel like this is one of the only industries where retail investors, regular people could start companies and you’re getting it ahead of the institutions and they’re coming in later than us, even to this point, right.

Frank Curzio: Where Bitcoin is right now, say the ups and downs, and now went through a little bit of a downturn, a lot downturn, but now, we rebound off the highs. Do you see that a reflection in more people come into your accounts, less people? Does it have to do with what happened with COVID, the amount of money they’re spending, 11 trillion? Let’s talk about the macro effects of the market and how that impacts maybe more or less accounts come into your Bitcoin IRA.

Chris Klein: Absolutely. Obviously, the product itself has a sizzle, right? It’s got big runs, big falls, very volatile so that generally attracts a certain type of buyer and has a certain type of motivation. In general, watching the ups and downs, what you see you’re right. The retail buyer started this, the retail buyer drives this. It’s still a catalyst to it. ’21 was really driven by an influx of heavy institutions. It started with Elon in the first quarter or early second quarter in MicroStrategy and just carried forward from there.

Chris Klein: But now, part of the institution’s coming into the game is why you see Bitcoin behaving like a tech stock. It’s starting to get some correlation because big players are making big swings on it. The retail buyer seems to me, especially the early adopters, and even though since they’re true believers in this. They’re looking at this as a long-term investment. They’re holding for three to five years, sometimes more. They’re very tech-driven and independently-minded driven. A lot of them came from IBM. We had NASA scientists, FAANG CEOs at C-level. And now, you have a whole new breed of retail buyer coming in.

Chris Klein: The biggest driver we saw about this time for last year, one that popped up and has stayed is inflation. Inflation is a big conversation from our account holders because everybody assumed that Bitcoin was a hedge against inflation, but hedges take time to manifest. They’re not instant successes, overnights band-aids, they take time. And what we see happening I think for the next few months is, how does enduring inflation really start to impact business value alongside other factors of the economy and the possible recession we may or may not be in? I think that’s where we’re headed, honestly.

Frank Curzio: Its funny people say that because I don’t… I mean, it really isn’t a hedge against inflation because when you have inflation sometimes you’re going to see rates go higher. When rates go higher than people get squeezed, a lot of leverage in the markets, and you start selling even the good things. So, even when people said, “I want to hold Bitcoin forever,” it’s… When you’re getting crushed in other assets and it’s forced selling and you’re getting margin calls, you might have to sell Bitcoin, right? And we’ve looked at gold as well, right, it’s supposed to be inflation hedge, but it’s not really inflation hedge. To me, being that alternative asset class is something separate from everything else is very appealing.

Frank Curzio: What are some of the reasons why you’re seeing some of your clients? Is it just hey, we want inflation? We hate what the government’s doing in terms of the destruction of currencies and Fiat. I mean, what are some of the reasons? Because there are so many different reasons to buy Bitcoin. It’s not just well, we hate the dollar, we hate the US. It could be inflation hedge has historic value, right? What are you hearing where people are buying and holding, which is an IRA, right? It should be you’re holding this stuff until you retire.

Chris Klein: Absolutely. You have the combination of both fear and greed. So, the greed part is, you had a lot of speculators over the years, right? 2017 from Thanksgiving to Christmas. My favorite meme is the dad sitting down with his son asking how to download Coinbase at Thanksgiving, and then by Christmas, he’s upset because it’s ran from what was it? 5,000 to 20,000 that year. A lot of greed and speculation driven.

Chris Klein: The truer believers are a little bit more driven by fear. And that fear is currency mismanagement across not just the United States, but across the globe. I’m 37, born in ’85, seen a lot. One of the big things I saw as I was leaving college was the beginning of QE in 2008 and beyond and just kept growing and growing. And now, it’s really escalated in the last few years. These things are fearful to folks that don’t know if it’s being managed appropriately. I think the vote last week or Saturday was a big deal to folks. Not a lot of folks really understood it, but it’s tucked into a lot of other bills and there’s a lot of pork and fat around it. But in truth, that was an inflation bill, so they’re fixing the inflation pinch by creating more of the currency that has too much supply which is partially driving inflation. It’s somewhat of a conundrum, wouldn’t you agree?

Frank Curzio: No, absolutely, absolutely. It’s funny. The Inflation Protection Act, that makes me laugh. We got to spend more money. They look at us, and I think they think the general public’s a bunch of idiots, but I think we’re starting to learn. That’s why it explains why you’re seeing so much power behind Bitcoin. Yes, you have the ups and downs but it’s for real, it’s here. Again, it’s the institution.

Chris Klein: It’s resilient, it’s relevant.

Frank Curzio: No, absolutely.

Chris Klein: It’s resilient and it’s relevant. It’s defined that for sure.

Frank Curzio: Take us through your company, Bitcoin IRA. So, say if somebody has an IRA and they want to have exposure to Bitcoin, which is very tough to do, right, it’s not easy. You created this company which I’m going to show it here if you’re on our YouTube page, guys. It’s got unbelievable reviews. I am not getting paid a dime. If you want to use coverage, which is very important. Talk about it because I’m the page now, Bitcoinira.com. If someone has an IRA and they want to have exposure to this, how do they do it?

Chris Klein: Obviously, first place you visit is either where you’re at right now, our website, or if you’re on your phone you can download the Bitcoin IRA app at the app store or the Android store. Both of them have plethora of education as you can see. There’s a lot of information, a lot of press, a lot of blogs, a lot of details. Education comes first with crypto, especially with the retail buyer understanding it. Once you’re ready and you’re interested, you can get started by opening an account on either channel. What you’re doing there is we’re putting you into the ecosystem so that we can open up an IRA account so that everything follows the same rules of your existing IRA account. Whether you have a 401(k), traditional Roth, SEP, SIMPLE. Like-kind is created on the other side and we prepare for funding. We run through compliance and all those details.

Chris Klein: One of the interesting things we do different than a lot of cryptos, we have human beings to work with. Because this is IRA money, and most folks are doing somewhere… While our minimum’s around 3,000, people do on average between 30 to 40,000 over their first year of investing into crypto, or whatever they’re comfortable with as a percentage of their overall. Once your account is ready for funding, our team kicks in because moving money from bank to bank… You’ve been in this game for a long time, is usually the hardest part. And being crypto folks, especially in times like ’17 and in ’20, after the COVID in ’21, they’re in a hurry, they’re insatiable, they’re ready to go. So, we try to fund as fast as possible through either rollovers from old 401(k)s, transfers from your existing IRA like at JP Morgan, Fidelity, et cetera. Or, some folks just get started opening their account for the year. You can contribute up to 7,000, 6,000 if you’re under 50, so you do your contribution for the year and get started there.

Chris Klein: Once the funds are there, you go back to the same place, either the website or the mobile app and you have 24/7 access to trade over 65 different cryptos. And the way that we constructed it is… This is IRA money, so security comes first. Or your funds are sitting in hot exchange environments, everything is traded or stored cold storage. Our exclusive partner for IRAs is BitGo. We’ve been with them since ’15, that’s when we started building-

Frank Curzio: Talk about cold storage, that’s important to know.

Chris Klein: Absolutely. So, cold versus hot. Absolutely. Versus hot. A lot of the horror stories you hear is folks, they get hacked on their Coinbase account or they are on crypto.com, whatever it may be. Exchange accounts are not storage facilities. You have a checking account and a savings account is the best comparison for me. My checking account I link to my debit card. If that debit card is compromised, the funds of my checking account can be compromised. So, I don’t put all my eggs in that basket, I put what I need for operations, right. The savings account has no cards linked to it. It’s in essence a cold storage banking account.

Chris Klein: What you do in crypto is, you add more keys and more administrative controls. In order for assets to leave a wallet, in our world, it starts with documentation KBA and video verification of a client, which is very robust, and then it goes through a series of administrative controls that access authenticated keys, which are basically, I call it salt and peppering. They’re geographically dispersed, et cetera. And these are all measures that are taken for the security of the asset at hand, and that’s what true crypto custody is about. Now, there are other ways to do this. You can get your own. Not with an IRA, it’s very difficult, but folks will do… That buy on Coinbase will go store it at a Ledger. You’re taking it away from the exchange environment where there’s more risk of compromise. That’s in essence what cold storage is all about.

Frank Curzio: I mean, for example, we have Ledger and Celsius, right? So, if you bought anything on there and removed it out of cold storage, when those companies shut down… They are in a process of paying back investors in a certain way which will take a little bit. Now you have it offline, where you could just throw it back on something else and that’s important. It’s BitGo, and I think Digital Trust. You say that you’re not a custodian now, digital amount exchange, so you’re relying on these partners. And these are very, very good companies.

Frank Curzio: If an individual has a what $10,000, could I transfer a certain portion of that over? It’s not going to result in any tax… You want to make it as similar as a process as possible, right, even when it comes to Bitcoin trading or anything. And the more it is where people can just go on, log on instead of you have to go to a different exchange to buy certain cryptos, the more easy it’s going to get. How easy is that process because I haven’t done it yet? I am going to do it with you. How easy is that process where… Could you just transfer a portion over where people might say, “Okay, I want maybe 15% there or 10% there?” Is everything the same when you’re transferring money through different IRA custodians?

Chris Klein: It’s just like with any other IRA custodian, you can do partial. So, if you had 10,000 you could say, “I want to do three of it, five,” or whatever it might be. Once your account’s opened on our side, our team will do what’s known as IRA to IRA transfer. This is a tax-free transfer so there’s no implication. The funds are staying in an IRA. Once they’re there, they’re eligible for trading and deposit very swiftly. But yes, all the same rules. Like a traditional, you can lower your income for contributions and have tax-deferred growth. A Roth, you don’t get that lowered income when you contribute, you do post-tax funds, but then you have tax-free growth you can pull out later without taxes.

Chris Klein: SEPS and SIMPLEs are specialists for self-employed or small business companies. But all these options have all the same rules they would at any traditional house, it’s just in a turnkey solution to access digital currencies including digital gold, which you mentioned, which a lot of folks when they’re sitting on the sidelines, not in the market right now, instead of sitting in dollar they will sit into gold sometimes.

Frank Curzio: I was going to ask that. So, say I sell my cryptocurrencies, right, and usually, when you sell everything or you’re managing your IRA or whatever, it’s got to go to a money market. Where does it go in this account? Is it money market account? Could you buy stocks, or is it just limited to cryptocurrencies? And also, I think you offer gold, right?

Chris Klein: Yes. You’re sitting in a money market account that is just U.S. dollar that can be used for any other alternatives. Anything but stocks. You’ll get your stocks at Fidelity, the TD Ameritrade’s, et cetera. We’ve had a lot of clients do really well. You mentioned some of our first clients were buying in at Bitcoin at $250, you can imagine how well they’ve done in their retirements. So now, they’re diversifying and they’re buying real estate property or into Reg A’s or PPMs. There’s groups out there that actually offer collections of wine through Reg A’s that you could put in. There’s groups like AcreTrader where you buy pieces of an acreage that are out there. So, these are all options inside of what we built for you, this beautiful self-directed IRA that can do crypto and other alternatives. Now, if say hey, none of those are for you, you want to go back, the stock market is soaring and you want to get back into that, you can go right back to Fidelity by just transferring the same U.S. dollars over.

Frank Curzio: Now, what about in terms of statements and everything? Are people getting statements, again, digital statements? Again, how perfect is it to where it’s just like an IRA where people are like, “Hey, I have an alternative part of the investment here?” You offer statements. Is it monthly, quarterly, annually?

Chris Klein: Everything comes to you with actually every month and then a year in for you all within the secure portal. The same place where you open an account you have a documented message center where our team can communicate to you. That’s where you also have record of any other things that you’ve done. Transactions, deposits, withdrawals, et cetera. It really does feel like your IRA for digital currencies and assets. We’re almost there. We started this 2015. I remember the first year when 2017, when it ran, we had hardly any tech in place because we’re a startup. And what we had to pivot towards was the automation that we built in years ahead, but they were phone trades for that first few years. Now, everybody was just buying Bitcoin.

Chris Klein: Once we got to the next level of it and realized that there were in and out transactions, swaps, payers, et cetera, that’s where we really evolved and brought in some great C-level talent and built. When everybody else disappeared in ’18 and ’19 from the space for a little bit, we doubled down, built out the right platforms, the right compliance, the right security, and brought this to be ready for when 2020, 2021 hit. And we’re still doing it today. One of the best parts of being on the cutting edge is, you’re always learning from your clients, you’re learning from your competition, you’re learning from what’s out there, and you’re always making a better platform for users today.

Frank Curzio: It’s amazing that you said that too because when a market does crash, even dot com, right, people run. Let’s say if they’re gone, they get pissed off and they’re like “I’m never investing again.” This last crash from 60 to 20, even to 18,000, I think we’re 23, 24 now, it’s amazing to see how many people are starting to push into this market right now. They really believe in a long-term where they’re not saying, “Okay, I told you so, it was going to crash.” It’s more like, “Okay, it’s down, let’s see what we could do.” Again, the sales taste of Voyager’s and some other companies and three hours and stuff, again, you’ll leverage out the you know what and that’s what happens to you. Where the survivors right now, the FTXs who are buying a lot of these assets are just going to get bigger and bigger and bigger.

Frank Curzio: You’re a great example of that, right? You lived through those, but you’ve learned through those mistakes and look where you are now. Let me ask you about the competition. It’s been late to the party for the Fidelity’s and BlackRock’s, but clearly, they’re getting in. What does that mean for you? Does that make you maybe a takeover candidate? How come it’s taken them so long? Are they only doing this because their client said, “Look, if you don’t I’m leaving because we want it?” Obviously, you look at JP Morgan, right, and they hated cryptocurrencies, but he’s like, “Our clients want it, and if you’re not going to give it to them they’re going to get it from someplace else.” You think that’s a positive that others are getting in where it brings more attention to this? Again, you have bigger players and stuff, but how is it related to your company, Bitcoin IRA, with the big players finally are going to be offering this to their clients pretty soon?

Chris Klein: I know. I love to see it. Obviously, the one thing they’re building towards is… You always hear it’s for the high net worth’s or it’s for the institutions or the mid-grades or whatever, it’s never for the average Joe. And then we took a different path because we’re here to help more Americans retire. We believe in the power of alternatives. Our clients have really believed in the power of alternatives. Not all of them, obviously. You could’ve bought crypto anytime in the last seven years and had a lot of different experiences, right? If you bought it last April, it’s a lot different than if you bought in March of 2020 or in summer of ’16. It’s all different. The value of crypto is ebbing and flowing based upon the value that it is perceived amongst other assets in the marketplace. It’s going to be volatile. It’s 13, 12 years old, so it’s an interesting process that it’s going to go through.

Chris Klein: I have an eight-year-old daughter, and she thinks she’s 16, and she’s pretty volatile so I’m pretty… It makes sense to me. Now, for us, there are other competitors that are smaller than the big boys that have come in. Business risk is a conversation that needs to be had. So, there’s always been product risk. The volatility of it and your own risk of having it on a hot exchange not cold storage, those types of things, that’s always existed.

Chris Klein: What’s new is the business risk. You mentioned Celsius, you mentioned Voyager. There are other groups, even in my specific industry, that are very new to the game and they haven’t necessarily dedicated the right resources for risk and security management. There’s stories that are out there. They link the wrong way with their accounts and they lose a bunch of money. They lost control of their website by a ransomware for a month or a week. These are things that happen with these startups because they become targets, right? Everybody thinks they can get access to the Bitcoin, people know Bitcoin has a lot of value, target gets bigger on their back. And these are instruments that you really need to know what you’re doing when you’re working with them.

Chris Klein: It’s not just stocks. Stocks are a little bit easier. I mean, they’re bond-bearing instruments so it’s a little different in the process. That’s important to realize. It’s not just the asset that you’re getting into. Understanding the security components, et cetera. But the business that I’m working with, what’s their longevity look like? How long have they been around? What problems have they had? What have they done to fix or solve those problems? We’re right in the middle of those two groups.

Frank Curzio: So not only that, you’re looking at banks, banks get hacked all the time. The big thing is they have insurance. Talk about the insurance part with the people that you are partnering with because it’s only U.S, right, you’re not doing anything overseas? This is the U.S., I think that’s what I read on your site. But the insurance that’s backing this too is important because sometimes you just can’t stop a hack, but banks get hacked, insurance companies get hacked, a lot of stuff gets hacked. But if you have the insurance on it, it’s a pretty big deal, a very big deal.

Chris Klein: Basically, your policies, procedures. Most banks are SOC 1. What crypto companies like BitGo have had to become and our other partners is, SOC 2 Type 2, which is a… It’s almost like on super steroids. SOC 1 is a series of pin tests and things, but SOC 2 is a very robust model where you’re looking at all the elements of risk that you have whether it’s your employees. Your clients themselves can be a risk because if they get compromised then what they can do within the system. So it’s a real look, a holistic approach to all that. You have the right procedures like administrative controls, the way the keys are managed, vaulting, et cetera, all the layers, then you can knock on the door of a Lloyd’s of London or a Chubb, a big insurance company, and say, “Hey, we want you to underwrite our process.”

Chris Klein: And BitGo was the first to do that. Now, because they were first, they have the largest… Up to $700 million of insurance per wallet. And the way you manage your assets, to make sure that clients aren’t at risk with that policy, is really the future of this. They were the trailblazers that got in the first conversation with insurance and have pressed the envelope. They’re the group that says, “Hey, here’s something new that’s risky in this space that we need to be thinking about.” I was just on the phone with their CEO, Mike Belshe, and we’re having conversations about that’s deep, fake technology that’s coming. That’s already an impact out there that now folks are going to have to worry about. Because everybody thinks, oh, Face ID is the way to go. Well, it’s going to have its weaknesses someday, right? 2FA is all about multi-factors. You want to give multiple layers to protect yourself.

Chris Klein: In fact, I’m a big fan of the YubiKey. I don’t know if you’ve ever seen those. They’re NFC or USB devices that they… I would pull mine out right now, but it would actually turn off my computer if I pulled it out so we don’t want to do that. But it’s biometric and it’s about… I think it’s about 150 characters that is custom to you that you have to physically put into it or press to put in there, it’s not something that can be put in any way. Those I like for control to my phone, control to my computer, and certain programs or apps that I use like my banking apps. You actually see some of the big players have 2FA with a YubiKey. That’s how you get into it.

Frank Curzio: They do. A lot of them do.

Chris Klein: They do have it now. It’s getting bigger and bigger. And that’s never going to end. Cybercrimes went off the charts in COVID, right? Every grandma had a new Nigerian prince that she was sending money to, and it just got worse and worse and worse. And it’s never going to stop because technology keeps going faster and faster. Remember, we’re on the cutting edge of technology with crypto, just like credit cards were the cutting edge, and then there was scams, and frauds, and theft, and crime, right? Every layer has had it and we just have to learn and grow. Client education, customer awareness. And we’ll get there.

Chris Klein: I sit down the street here in Sherman Oaks, California with a group of old guys at the Starbucks, and they’ve been getting together at the same Starbucks for over 15 years. They were even defiant during COVID, in California, and would go and put… In the parking lot, they put a series of lounge chairs together six feet apart so they could get together and have coffee together. These guys were hilarious. And I talk to them all the time. They’re just starting to really get comfortable with the concept that money has changed again. It was Venmo, and WhatsApp, and these cash app programs, and crypto is the next evolution of that. It’s not just money. That’s the thing I think a lot of people miss. There’s so much utility to the digital asset space that are going to change things that have nothing to do with money that we haven’t even seen. I’ve always said that it’s going to be embedding itself into our lives just like internet or email did before it.

Frank Curzio: So talk about utility, because right now, we had the regulation part where the SEC, FTC, who knows, is going to regulate crypto. You know as well as I do, you’ve been around these industries for a while, these are securities, right? They fit the perfect definition of securities. And you could say maybe not Ethereum, maybe not Block… Bitcoin. It could be Bitcoin, there’d be five or six in there, but a lot of these are… They’re securities, right? People are buying to make money off of them. And there will be regulation down the line. If that happens, do you see that hurting? Bitcoin, Ethereum, I think are going to be absolutely fine. Those are the two big ones, right? And maybe again, you could throw three, four, five more in there.

Frank Curzio: Would that impact anything with your business? Because I could see some of these companies actually coming out of the U.S. going someplace. I mean, you’re going to have to report everything that you’ve done, a lot of these companies are going to be like whoa, wait a minute. And not only that, it costs a fortune to do and you might have some fines there too. A BlockFi or some of the other companies and said, “Okay, we’ll pay the fines or whatever but we want to be fully regulated.” And again, when you put the stamp of approved regulation, and when it comes to Bitcoin, people want to see less but you need regulation in order to get the institutions in where they feel safe. And you don’t want anything with the regulation of safety you’re providing, but how do you see that playing out in terms of security?

Chris Klein: I think it brings that guardrails that make folks more comfortable. Yes, there’s going to be people that’ll say, “Well, I don’t want to do this anymore because it’s more regulated.” And those are groups that probably shouldn’t have been in the space, to begin with. They, obviously, had ulterior motives. They didn’t want to be transparent, they didn’t want to have the necessary… I mean, what happened at Celsius and Voyager is a great example of why you need regulation because they were basically offering huge rates of return that were unbearable, and they were having to make riskier or more long-term lockup decisions with the assets to make those yields. And eventually, they were stacked in one direction. And with the staking and the merge being delayed, they get into an illiquid position. Now, at the same time, Ethereum and Bitcoin tank because of selloffs at Luna, and now people are withdrawing and they want out, and now you’re stuck between a rock and hard place.

Chris Klein: This is what regulation fixes because it puts the right standards and practices to place. Now, where we have the problem with regulation right now is it’s a land grab. It’s coming from so many directions and there’s not really a clear understanding of the asset itself and how it operates there. I think there’s going to be a new class of regulation that really works its way around the digital asset space. And they are going to be securities, and they’re going to register, and they’re going to do what they have to do to keep clients and consumers safe and followed by a set of rules. But I think once we get through the shock effect of that, now you’ve got a real asset class that’s ready to blossom. It’s really going to take it to the next level as far as its market cap.

Frank Curzio: So, what about the fees when it comes to Bitcoin IRA? Could you talk a little bit about that? I imagine my own 401(k)… Not my 401(k), but my IRA, and, obviously, I’m buying through SAFE, it’s E-Trade, right. I’m only selling now. If I’m buying through E-Trade, they’re making trading fees and stuff like that. But even if it gets into bigger 401(k)s, is there a different percentage that you guys chose? A percent of total assets that you have in your portfolio? Talk about the fee structure. Is it comparable to what you would see in a normal IRA or 401(k)?

Chris Klein: Depending upon the asset that you’re buying, right? There’s some assets that just have assets under custody fees. Most like the Fidelity’s and stuff are making their money off of the back end the transaction or otherwise. The way ours works is, we have a transaction fee of 2% and we have an ongoing annual fee of eight basis points a month, so just under about 60, 63 basis points a year. That covers the insurance and the security to keep everything safe, and then 2% in your transaction fees whether you’re buying or selling. And that encompasses our fees and allows us to run the business to keep everything going for our clients and keep growing new technology for this space.

Frank Curzio: No, it makes sense. I want to end with this. I don’t know if you’re able to say this, but in terms of the conditions right now… And for me, I see a lot of institutions coming in right now, finally being allowed to come in. The amount of money we’re talking about is hundreds of billions of dollars just with the little allocation that they could put towards Bitcoin, and Ethereum, and some of the bigger cryptocurrencies which it would move the needle tremendously. And we’re going to see that continue to open up, right? Just like I mentioned earlier, BlackRock, Fidelity, and you’re going to see State Street, BNY Mellon, these trillion-dollar institutions managing trillions of dollars.

Frank Curzio: Is there anything that you see in this market? Should people be buying Bitcoin, Ethereum? Is there anything that you see like, hey, this could be one of the biggest ones? I don’t know if you’re allowed to say that or not, but I’m just curious to where do you see the market going? Obviously, you’re probably going to be bullish on it. Is there any individuals that can make that top five list? Again, I think it’s 60 cryptocurrencies that you cover, or maybe it’s even gold, or allocating the money towards gold. I was just curious if there’s anything you’re seeing that really has you excited right now?

Chris Klein: My compliance officer’s right here on my shoulder and saying, “Be careful, Chris,” because… Obviously, we’re a self-directed platform, we don’t offer any of those things. I can tell you that the dominance of the IRA space is Bitcoin and Ethereum, obviously. Bitcoin and Ethereum probably account for close to 60% of our overall… We’re about two billion of assets under custody that are being worked on our platform now.

Frank Curzio: What’s third? What’s ranked number three on your platform, could you tell me that?

Chris Klein: I think it might be gold. There was a battle of Ripple and Litecoin for a few years, but Ripple, with its SEC not tradable, basically closed out in December of ’20 going into ’21 so that one’s off the book there. I think gold. Litecoin is popular. You’re seeing Cardano and some of the others start to rise. But then you see groups like Solona, which is having a problem. It’s not Solona’s network, it’s the wallet that’s using it that keeps having these issues. But there’s these cross-chain links. We’re getting a little fancy here, and it’ll be interesting to see which ones get adoption over time. I’ve always told my fans, my family, and clients that I myself personally also keep it very simple. I mean, I have every coin because I’m the tester so I have to go on my phone, I have to go… Whenever a new coin gets added I have to go and test it, and trade it, and try to break things, so I’ve got everything in my IRA.

Chris Klein: Where we’re headed is Bitcoin’s going to lead this industry in space. And Ethereum is the backbone to what could be the future of privacy on the internet. Web3, four, and five will hopefully give us back some of that privacy that we’re looking for, or at least that personal security. I mean, the advent of the internet has just swarmed and grown and grown and grown and it’s starting to have some negative impacts to it, right? Just a lot of things happened over the last few years when people were locked up and what internet can do to the psyche of human beings. Having some privacy back on our browsing and things like that, I think that’s what folks are looking for.

Frank Curzio: That’s cool. And Chris, I want to thank you so much for being on the podcast. There’s been a feature on Forbes, Wall Street Journal, CoinDesk, CNBC, Barron’s, I’m putting them up right now. I mean, the five-star reviews is incredible. And you being a pioneer in this industry that’s really, really cool to see. I can’t wait, what the future holds. But I really want to thank you for coming on this podcast and explaining because a lot of people do want to put this in IRAs, and it’s still difficult. The institutions are not there yet, they’re trying to get in. We’ll see what happens with regulations. But it’s good to see that you guys are here, did it the right way, and have insurance backed and stuff like that, it’s really, really cool. So, I really appreciate you coming on the podcast, man.

Chris Klein: Thanks for having me. Again, it’s been actually more of a pleasure for me. I look forward to hearing the episode.

Frank Curzio: All right, sounds great, man, I’ll talk to you soon. All right, guys, great stuff from Chris. I had no idea he was a big fan, long-term listener to the podcast. Really great stuff. I mean, I don’t get paid a dime from these guys, I did a lot of research on them, deep dive. It has incredible, incredible ratings. They’re endorsed by a lot of different media outlets. These guys have been around a while. And the fees aren’t outrageous considering lots of traditional funds charge more than that, and I won’t bring up any names here but they do for just horrible performance and things like that. Anyway. But they’re in line. I mean, they’re insured, it’s pretty cool. Again, to look at those ratings, they have many five-star ratings and see how long they’ve been around. I love the fact that I even questioned him on that, they’ve been through a lot of ups and downs. You see what happens when you have these big down markets because a lot of companies get crushed, they’re over-leveraged.

Frank Curzio: 2015. I mean, come on. How many crashes? At least three major crashes. Probably if you go back to 2015, four major crashes in Bitcoin and cryptos and they’re still around, meaning they’re doing the right thing. So again, great ratings. I don’t get paid a dime. So, if you guys have a bad experience, let me know. But I thought it was pretty fascinating. I didn’t know too much about these guys, I didn’t know too much about Chris, and it’s awesome. Plus, I mean, having a seven, eight-year track record in cryptos is like having a 25-year track record in most industries. And most people start investing in cryptos through Coinbase I would say. The average person, 2019. Yet, you have crypto guys out there ’16, ’17. Of course, ’17 was a big year where… But still, you didn’t have the general public. That long, that much experience, and the fact you could find a lot of information on Chris knows that he’s been doing the right thing in this industry. Pretty amazing. The companies that he did partner with are fantastic. Just awesome. I just want to bring that to you.

Frank Curzio: I get a lot of people asking me, even my employees, is there any way we can invest in my stock, which is our token, CURZ, who have an employment plan? Or, can I put some of my IRA in? A lot of people are asking for this. I’m not telling you to put your whole retirement into Bitcoin and crypto, it’s a volatile industry. But people want to invest, and you should be investing in alternative asset classes. Maybe it’s 1% of your portfolio if you’re older, maybe it’s 3%. Maybe you go a little higher at seven to 10%. And there is a greed factor there and people want to hold things long-term as well. The fact that so many people want this is the reason why Fidelity, trillions in assets. State Street, trillions in assets. You’re looking at BlackRock. I mean, all these guys are going to have availability to this in your 401(k)s, through IRAs. And the fact that Chris has been doing this such a long time and everyone’s trying to penetrate this market still is pretty incredible.

Frank Curzio: Again, you have his website up there. If you have any questions, feel free to go out there and ask him. Really cool stuff. And I love to get feedback as well from you. I like Chris, he’s a great guy, it was a great interview. Hopefully, you guys enjoyed it. But like I always say, the interview’s about you, not about me so let know what you thought at frank@curzioresearch.com. That’s frank@curzioresearch.com. I always say this, but I mean it, I really appreciate all the support, guys, I really, really do. And hopefully, you guys have a great week, or should I say weekend. I do a podcast which is tomorrow, only available for paid subscribers, just Frankly Speaking. So, no matter what subscription you have, even if it’s the $4 a month for Dollar Stock Club, or the $5,000 plus for some of our other subscriptions, you get free access to Frankly Speaking. So, I’ll see you guys tomorrow, our subscribers. Everybody else, have a great weekend. I’ll see you next week, take care.

Announcer: Wall Street Unplugged is produced by Curzio Research, one of the most respected financial media companies in the industry. The information presented on Wall Street Unplugged is the opinion of its host and guests. You should not base your investment decision solely on this broadcast. Remember, it’s your money and your responsibility.

Frank Curzio
Frank Curzio, founder and CEO of Curzio Research, is one of America’s most respected stock experts. His research is regularly featured on media outlets like CNBC’s Kudlow Report, The Call, CNN Radio, ABC News, and Fox Business News. His Wall Street Unplugged podcast—ranked the No. 1 “most listened-to” financial podcast on iTunes—has been downloaded over 12 million times.

Editor’s note:

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