How Every American Can Invest in Bitcoin for Tax-Free Gains

Adam Bergman, founder of IRA Financial, is championing a strategy he believes could help every American build long-term wealth with cryptocurrency—by using self-directed retirement accounts. In a recent interview on the Bitcoin.com News Podcast, Bergman explained how IRAs can unlock access to bitcoin while preserving the powerful tax benefits associated with retirement savings.

From Early Bitcoin Skepticism to Long-Term Holder

Bergman’s journey into crypto began in 2014 when a client asked if bitcoin could be purchased with an IRA. Despite initial skepticism and pushback from financial advisors, he began investing in bitcoin personally and has held onto it ever since. This experience cemented his belief in self-directed retirement accounts as a tool to invest in alternative assets, including digital currencies.

The Case for Self-Directed IRAs

Unlike traditional retirement accounts limited to stocks and mutual funds, self-directed IRAs allow investments in real estate, gold, private businesses, and now bitcoin. Bergman highlighted that the structure has existed since 1974 and carries substantial tax advantages: contributions are often tax-deductible, while gains grow tax-deferred or tax-free depending on the account type.

He emphasized the compounding effect of holding bitcoin in such an account, noting that the growth potential of the cryptocurrency could be fully realized without tax erosion.

Why Roth IRAs Offer a Unique Advantage

A major theme of Bergman’s message is the unique power of Roth IRAs for crypto investors. Contributions are made with after-tax income, but withdrawals after age 59½ and five years of account maturity are completely tax-free. This, he argues, makes Roth IRAs particularly well-suited for long-term bitcoin investment, enabling compounding gains to be preserved in full.

Rules, Risks, and Opportunities

Bergman also clarified the rules around IRA usage. Funds cannot be used for personal loans, and while margin trading is technically possible, it may trigger unrelated business income tax. Still, most trading strategies, including options and decentralized exchange transactions, are permitted.

Only three categories of assets are prohibited: life insurance, collectibles, and investments that directly benefit the account holder or their lineal descendants. Beyond these limits, investors have wide latitude, ranging from crypto and real estate to venture capital and private equity.

Building Generational Wealth

Bergman underscored that holding bitcoin in a Roth IRA not only provides tax-free growth but also encourages long-term saving because of withdrawal restrictions. He sees it as a vehicle for building generational wealth, which can be passed down free of tax burdens.

He acknowledged gray areas in taxation for staking and airdrops but expressed confidence in the growing regulatory clarity around digital assets. The IRS classifies them as property, creating a framework that supports investor confidence.

Looking Ahead

Bergman is optimistic about the future of bitcoin and digital assets more broadly. He views bitcoin as still being in its early stages, with significant upside potential outweighing the risks. He also pointed to growing institutional support, favorable regulatory signals, and the intersection of crypto with emerging technologies like artificial intelligence as drivers of future adoption.

Concluding his remarks, Bergman encouraged Americans to explore self-directed IRAs and consider allocating bitcoin into Roth accounts, calling it one of the most tax-efficient paths to long-term wealth creation.