Using Crypto IRAs to Invest For Retirement, With Chris Kline

As crypto continues to become a feature of investment portfolios, it is now factoring into retirement plans. Specifically, you can now open crypto IRAs. How is it done and what is the power of cryptocurrency in a retirement portfolio? Chris Kline, Co-founder and COO of Bitcoin IRA joins the show to discuss.

Chris co-founded Bitcoin IRA, and then developed the process and exclusive partnerships to create a full-service, turnkey solution allowing investors to capitalize on the rapidly growing digital currency marketspace for their retirement portfolio while maintaining full IRS compliance.

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Episode Highlights

What is Bitcoin IRA? Advantages and disadvantages: “A Bitcoin IRA is like a self-directed IRA, a type of individual retirement account that lets you invest in things like real estate, metals like gold and silver and digital currencies prohibited for traditional IRAs. Although it significantly increases the risk for your retirement account, investing in BTC may improve your investment performance and offer greater diversification. Custodians who oversee self-directed accounts and permit virtual currencies as alternative assets are in charge of such Bitcoin IRA accounts.” (Cointelegraph)

Bitcoin, Ether To Be Regulated as Commodities by CFTC, per New Senate Bill: “The legislation clarifies that bitcoin and ether are classified as commodities, as opposed to securities which are under the purview of the Securities and Exchange Commission (SEC). The bill does not mention other tokens or provide criteria for classification. Exchanges that enable investors to trade bitcoin and ether must also register with the CFTC, the bill notes.” (Blockworks)

Coinbase selected by BlackRock; provide Aladdin clients access to crypto trading and custody via Coinbase Prime: “The Coinbase partnership between BlackRock and Aladdin is an exciting milestone for our firm. As the trusted partner enabling institutions to participate and transact in the cryptoeconomy, we are committed to pushing the industry forward and creating new access points as institutional crypto adoption continues to rapidly accelerate. We are honored to partner with an industry leader and look forward to furthering Coinbase’s goal of providing greater access and transparency to crypto.” (Coinbase)

Featured: Chris Kline of BitcoinIRA

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Cryptogic is the show for crypto investors who are focused on long term results. Follow host Scott Hawksworth as he explores the investable world of blockchain technologies, Bitcoin, Ethereum, and other cryptocurrencies.

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Show Transcript

Scott Hawksworth: Hello and welcome to Cryptogic. I’m your host Scott Hawksworth and today we’re going to be talking about crypto for retirement and crypto is part of retirement portfolios and joining me to offer his perspective and insights is Chris Kline, who is the Co-founder and CEO of Bitcoin IRA, which aims to help folks do just that. That’s invest in cryptocurrencies, you know as part of their retirement portfolios. There’s a lot to cover here and I’m really excited to to dive in so, Chris welcome to the show.

Chris Kline: Hey Scott thanks so much for having me today, it’s a pleasure to be here.

Scott Hawksworth: Well, thank you for being here, you know, as I said, we want to talk about crypto for retirement so let’s just let’s just kick things off with a bang, what is your, I guess, thesis for the value or the power of cryptocurrency as part of a retirement portfolio.

Chris Kline: Great question I think I’ll start with our mission. So our goal as partners, was to help more Americans retire. We’re in a retirement crisis that most folks don’t really talk about. You have less jobs that are offering things like 401 k’s and matching on those are more of a gig economy so more people that are doing freelance work, Uber etc., that aren’t getting 401 k’s of retirement and we’re at a place in time, especially for this younger generation that with between rent a car bill a student loan payment retiring makes the bottom of the list.

So thinking outside the box two alternatives is paramount and it’s almost a prerequisite for the next generation, the old school 6040 stocks bonds mutual funds has to be mixed up and there’s so many opportunities and emerging alternatives there’s been so much money made in real estate in IRAs.

People use precious metals and tough years in crypto to us just made sense because of the belief of its long term growth potential so many folks early on, when they were buying it at $250 a bitcoin in their IRA seven years ago, we thought it was going to for sure, be a million dollars a bitcoin someday.

And with it’s finite supply kind of makes sense if there’s 8 billion people and there’s 21 million bitcoins, math checks out right.

However, why wouldn’t you want to have that in a setting where you have tax advantage so with a Roth IRA with a traditional like a 401k or traditional IRA, you’re going to be able to lower your incomes, on your on your taxes for the year that you contribute.

And, as your your value grows you trade all day or inside and out of it and make changes you’re not going to have to deal with the capital gains implications.

So if you’re a true believer in the future of this Ai technology in space there’s no better place to have your long term holdings than in a retirement savings.

Scott Hawksworth: Now, I think that makes so much sense, and I mean I don’t have the statistic in front of me, but you know there’s that that sort of eye opening statistic of how.

Certainly in certain generations, I know millennials they how little they have saved for retirement, right now, so I think that.

That sort of drives home your point of the imperative that we do have this crisis, and you know alternative investments can be such a powerful part of that and being creative, because if you’re right it’s not just like the old school, you know stocks bonds all that right.

Chris Kline: yep exactly and people are more excited about these types of investments to they see that the when you look at the whole group landscape there’s a lot of use cases.

that are going to have major impacts on our life i’ve always said that bitcoin is going to embed itself in the daily life of our daily lives, a lot like Internet and email didn’t before.

Scott Hawksworth: Absolutely okay so bitcoin IRA, can you tell us a bit about it and sort of how you help you know folks invest in these crypto currencies, you know as part of their retirement what’s the where’s the rubber meets the road there.

Chris Kline: Absolutely, so what we did was we built a fintech platform that was designed so that clients can easily open fund and trade their crypto accounts now, this was an easy the beginning right didn’t even exist when we started this.

So it was all from scratch building new concepts putting together pieces, but what you find is you need three critical elements, you need to have an exchange that is OTC and cold storage driven it’s huge it’s for security.

you’re going to need to have.

A wallet security provider we partnered with viggo exclusively.

If I guess eight or nine years ago when we build this and we helped build that helped them build that multi signature cold storage geographical syndicated keys.

so that it could sit in the framework of a trust custodian a bank.

That is specializes in self directed IRA groups, so you need all three of those working in tandem, through a seamless technology so that clients can easily just open up an account on mobile or desktop funded.

And then traded at their discretion and the 24 seven treating was one of the hardest hurdles, because every other asset class goes to sleep at Friday at 5pm.

Right markets are closed.

Right, exactly, and so you have to buy when you jump into this space, you have to be committed to a 24 seven cycle for your clients.

Because the behavior of it, I mean we saw just this year a few weekends, where crypto in one direction or the other very swiftly.

Giving opportunities if a client is looking to get in or out of the market at that point in time.

And then, what we did our I think our secret sauce personally, is that we didn’t lose track of the human element, so in crypto so many spaces and now, people are seeing this when they’re looking for service.

Is all robot driven faqs chatbots those things on websites there’s no human.

We were working in the past with much more human action without interaction with iras people are investing.

On average about 40 $50,000 over time, this is an important piece of their portfolio, they want to have something they can work with so we didn’t take that human element out and back to the double down on it and.

Each client has the ability to work with a direct account manager and learn things ask the questions about coins, or how this works or what this projects up to over time.

Scott Hawksworth: And with this with this platform that you’ve created you know, investing in IRA So if you help with you know the tax forms and saying okay yeah here’s your contribution limit okay i’m going to do this, all of that.

Chris Kline: yep exactly that’s what the The self directed IRA insurance company is all about, and in fact over the years, we were working with several and in time we realized, you know what we probably do this faster.

and make our clients have a better experience we did this ourselves so last year, it took us we started building in 20 we launched digital trust or vertically integrated trust custodian for our platform.

And what that helps with is we’re putting the bitcoin mindset, to the trust custodian world.

These are usually a little bit more old school type companies that are using paper forms and and and different types of things for validation and security, and we just put it on steroids, and now.

it’s so easy for them to open make changes and those types of things.

And that’s why you need that custodian because you want to keep those assets at arm’s length distance find a wall that make sure that the tax reporting and all the moving parts associated with the account that give you all that tax advantage stay consistent.

Scott Hawksworth: Not makes makes total sense, and I think that that does show you the power of that as well, especially when you look across crypto and you hear some of these you know horror stories of folks not doing things the right way and.

You know, maybe there’s people that don’t understand the tax implications of some of their crypto investments, I think, having everything you know done together and above board is really key and I think that gives that comfort, especially when you’re talking about retirement right.

Absolutely.:

Scott Hawksworth: So Okay, I guess, to that you have not just bitcoin your your bitcoin IRA, but you know, I was, I was peering through, and you have 60 plus crypto currencies that are currently supported.

And you know we’ve had we’ve talked about this on this show the the process for you know how do you determine a project worth.

You know, investing in versus something that’s not you know determining Okay, you know what are these newer coins and and are they worth anything.

So could you speak a bit to your process, for you know you have those 60 plus cryptocurrencies.

How do you go about you know, adding a new crypto to your platform what are, maybe some of the the standards or or things that you’re looking for when you guys decide hey we want to support this as well.

Chris Kline: Absolutely well first we’ve always listened to our clients, so we started as big point IRA back in 2016 was the first one.

With ED moy former director, the US mint and then in April may have 17 we brought in theory to the table and then later that year we added a like.

I think litecoin there was a bitcoin cash for that took place with the support that and ripple and then over time, it was it’s really just been there’s two key parameters for us.

Is one can we store it securely.

If we can’t get the technology support from our partners and viggo that put it behind $700 million of insurance sock to type to ratings and all the administrative controls we use to administrate and manage the custody and storage.

If that doesn’t exist, then you’re already off the list.

right next yeah because there’s no point in carrying around a bunch of ledger’s we we’ve seen it they put these Frankenstein models together out there, where.

They got later legends and traders, then they got some hot wallets and some cold wallets it’s just points of risk over time.

cold storage so cold storage is the best way to handle things so that brings us to the second one is can we procure consistent and viable liquidity.

And an OTC fashion, where we can set, we can create an execute trades through technology and settle them securely through cold storage.

And there’s about four or five major players in the OTC space, so if any of them or a group of them are able to come together to support it it’s not just about getting into the asset.

But you don’t want to put your grandma and something that you can liquidate for years or otherwise take those was an example that early on in our years where it had a lockup period for several months.

Currently ripple has that situation with the SEC investigation happening so yeah that’s not a perfect algorithm or equation because liquidity changes over time.

For example, the forks at the beginning bch was very strong support still is, but some of the offshoots like BCG and BSP have just fallen off there’s not very many people that are really interested in.

Holding a book to manage that asset so that’s the second and then you have to look at what is this utility all about so it’s and we learning this even more with projects is who’s behind it what’s the White Paper all about.

Is it doesn’t have any backing, is it old archaic, or is it truly democratic were the decisions made and building consensus.

And and that’s just an understanding and then watch how it behaves in the market.

you’re never going to be one of the the i’ve always said you never want to be mocked one of something right you want to be the guy jumps in first.

Wait watch a little bit what’s happening if the market 24 hour market volume supplies happening transactional supplies happening, not just for a day or two, but over weeks.

Months and quarters now you’ve got an asset classes starting to come together and for me it’s always the utility what are they intending to do, and if they can’t tell you that in a matter of a few sentences.

Then they probably don’t know exactly what they intend to do with this coin right and it’s gotten so much better, I remember 2018 the ICO era where.

Scott Hawksworth: Am I.

Chris Kline: Oh Paris Hilton had a coin everybody had a going.

That was that was chaos, it was what I call the Wild West days.

we’ve we’ve shifted from that you still have went through stages, you know there’s seos out there, the nfp space has a lot of that noise, right now, as we saw over the last year with prices deflating.

entities are amazing don’t get me wrong they’re going to do incredible things and what I think my child is going to be known as a shopping environment, you know we were our parents grew up on the sears.

roebuck sears roebuck catalog we know the toys R Us pages in the newspaper on Sundays our kids are on YouTube and now the metaverse is now.

And that’s where that’s where commerce and retail is going to happen so that’s huge and if these are huge, but those are kind of the steps that you go through is, can I keep it safe, is it liquid and what’s it all about.

Scott Hawksworth: And I think that’s fantastic and I guess to ask to I guess tease out a bit more, especially when we’re talking about security and liquidity and you know these assets, they are risky assets.

To invest in whether it’s this show or sister show, and if the investor nation i’m kind of a broken record and in saying that and.

You get a lot of pushback in general, I mean especially you know we’ve had the markets have taken a hit, certainly in 2020 to hear a lot of pushback in general for for crypto and then you start talking about retirement and.

It will look at risk, even differently when it comes to Well, this is my retirement nest egg this is this is something that you know i’m hoping to live off of.

And you’ll get that push back so if there’s someone out there who’s saying Oh, you know I don’t know if if any kind of crypto for retirement is good, maybe they read those horror stories about.

You know we’ve seen companies struggling with liquidity issues, and you know all these marketplaces all of this, what might you say to them to maybe shift their perspective or provide a counterpoint.

Chris Kline: Well, I think the first thing is the crypto as a whole is very overwhelming right there’s.

1516 1700 different coins now with nfc is nothing it’s a lot stable points and what all this means what’s the fire, etc.

One of the big tenants I have is just keep it simple it’s pretty obvious that bitcoin has the dominance in this space right and if you’re if you’re betting on.

crypto having a future bitcoin is going to be the monetary instrument of that future right, so we even have that in our book probably 60 to 70% of our book is is in the bitcoin space follow closely thereafter by.

By eaten by a theorem and then a mix of the others, and so what most folks look at is you know I want to understand what i’m doing bitcoin makes the most sense a theorem.

Obviously, makes sense is the backbone of web three possibly four and five, so it all it all fits as a model, so you get a little bit further down the tail and it’s just less exposure that you put yourself to.

volatilities huge right, this is something we’ve realized and known i’ve only been in this space for eight years and I know it’s reality.

But getting off zero is paramount you don’t want to be the guy in 20 years when all these crypto have grown up and have been become parts of our lives and are running and doing amazing things and changing the quality of life for humans on earth.

Once all that’s there and you’re the guy that never got off zero never got any exposure with bitcoin even a little bit.

is a good starting point, so what we see with our clients is, they will have their established retirements they have maybe a 401k and IRA and a mix of different accounts they have.

And maybe they’ll just start with a new one they’ll they’ll open up a fresh one do their 2022 contribution for the year, so I there about six to 7000 depending on your age and then, once you get a feel for it.

You get excited about it, you go down the rabbit hole you start finding podcasts you started learning start following on Twitter you’re really learning about what the space can do, and you get more excited and you start watching and adding.

Here there as you feel more comfortable to the mix of your overall portfolio with it, but getting off zero taking that first step, I think, is really important, and you’ll you’ll you’ll let you’ll you’ll be thinking yourself later in life, once you do that.

Scott Hawksworth: Right and and with a platform like yours working to make that even easier to take that first step right yep.

Chris Kline: Exactly, because when we first started this years ago you had to go find your ledger ledger is very difficult to manage I actually have one right here, I still use them for.

Certain thing.

I understanding seeds understanding all those things and even once you do all that right, you can still mess it up right, you can still have the seed stored with your legend device, and they both get lost at the same time and or.

You can lock yourself out of things we’ve seen those words were so finding the right platform is us now that’s the new era of risk.

That the there’s two areas of risk now and crypto the first and it’s always been, there is the volatility.

The second that we’ve now seen to come to light here in 2022 and it’s been before that, but it’s been pretty concentrated here.

Is the business risk the platform that you’re doing business with so you saw that and we see it, a lot right now with Celsius and Voyager what happened in there and the three AC default on billions of dollars of.

Basically, lending and Lotus notes and they all lock themselves in a bunch of the East state to try to pay off those crazy rates they were offering.

And so that’s a place that’s one of those you also see security risks on the platform’s themselves, it was early on a lot of exchanges were hacked because.

Their security wasn’t up to snuff right Well now, you have a lot of new businesses coming in, then don’t have a general appreciation for the.

amount and the large target, you have on your back as a crypto platform so for us, we keep everything segregated in cold storage.

away even though you’re trading and it feels like you’re on an exchange none of that is happening right there, so if you’re compromised somebody gets through your two FA and gets access.

they’re not getting any pii they’re not going to be able to do anything with your coins that anything that moves out of the ecosystem has certain parameters to it.

These are just things we learned over eight years right and that’s all you’re always driving, for we have we have competitors in our space it’s.

In the IRA space and most your listeners are probably review and see the thing is their new their fresher and they all have had issues they’ve either lost control their website and ransomware attacks for weeks or months.

or they have lost money, all together, because the way they linked wallets and things so.

The new risk is who am I, working with who am I, who am I, who am I trusting and put this to work for me if i’m going to do the defined staking and things, who are these guys.

About run polls and things we’ve seen and then platforms, that I like retirement, I want to store long term.

Is it insured, am I able to and what’s the liquidity like what’s the procedure to take it out, these are important questions to ask and understand before you to jump in with one platform that you trust.

Scott Hawksworth: 100% and and even to that you know even folks you know, sometimes life happens and people need to draw on their IRA earlier they don’t want to do that, but that can happen and and other you know elements can happen, and you do need that liquidity there so.

Chris Kline: For for younger folks with Ross and we see a lot of folks do this now is that because it’s the tax the way you do a Roth is you don’t get the benefit on the front side, but then you don’t get any taxes on the back side once.

You can use those funds for certain qualified events first time homebuyer expenses higher education expenses and not take penalties for them.

And that’s you know if you can build something up growth tax free and then utilize it in that fashion and then maybe even be able to process an investment with it.

that’s really powerful for a generation that is facing a pretty steep summit every few years you know, I was born in 85 we’ve seen everything in our lifetime right we’ve seen pandemics recessions wars pretty much the gauntlet in our lifetime here.

Scott Hawksworth: yeah you know it’s there there’s always those means that go around when the next thing happens i’m like okay that’s great you know, and I still you know, even when I was in.

gosh I was a freshman in high school in September 11 happened, it was like Okay, so I think that that’s where a lot of folks in our generation.

do have this different approach to retirement, because they they are fighting uphill battles in a lot of ways, financially and then there’s also just this awareness of Okay, I need to I need to be prepared for anything.

Chris Kline: yeah exactly exactly and that and that’s just the nature of where we’re at today, I was actually I think a sophomore junior is taken an ap us history practice tests as the towers were falling.

Oh, my God number, and I remember saying.

I teach I think I think the whole books being rewritten right now, and he goes Chris I don’t disagree with you but they’re not going to test you on this next month.

Scott Hawksworth: that’ll be your kids are going to learn about this.

Yes, um so we’ll speaking of you know everything changing and the unexpected there’s this other piece, when we talk about crypto and I know it’s relevant to investors and folks that would be interested in, you know retirement.

that’s the regulatory landscape of crypto and I have it here, I know it was, I believe, just yesterday um there is a new senate bill that is going to seek to regulate bitcoin and ethereum is commodities under cf TC.

What impact, maybe in general, do you think this type of regulation can or will have on the crypto world and maybe what’s your broader perspective on the regulatory landscape with crypto, especially through that retirement lens.

Chris Kline: Yes, great question landscapes, are the regulatory landscape spin the buzzword for this year but it’s really been around for a while, so.

Being a business owner if you’ve ever ran a business, you have to advertise your business right that’s the reality, so the the broad stroke and regulation that occurred in 2018 to 19 was.

A disabling have the ability to advertise a crypto company, because there were so many icos and so many scams and so many things the smart move the broad stroke move that they took was.

Just don’t let them advertise and that will weed out the winner the the real in the in the difference, and it was hard as a business or at the time, because.

A map engine you use things like Google and others to advertise your business, and now you just can’t they just don’t exist it’s not a matter of cost prohibition it’s just you can’t use it, because you’re a crypto company.

That was the beginning of regulation, and it was very rough very knee jerk but something was going to happen, we all knew it since then there’s been an evolution of understanding so there’s been.

what’s Nice is the resilience and relevancy of bitcoin has required that regulators bring it to the table, have a conversation about it.

understand how it works now now they’re learning a lot and they’re still kind of a land grab happening so you still have the SEC has major changes under.

Investigation see FTC has it’s built from the from the the Senate and it’s about calling these commodities management this way and it’s probably going to be a mix.

of groups or an entirely new group that’s going to come and be part of crypto regulation, I and most of the folks I know that are legit players in this space applaud this.

These are the guardrails that we need to keep.

Consumers protected otherwise and the great example was Celsius and Voyager a great example because had had those types had there been a rule set that they had to follow like campbell’s that banks have to use.

A certain number of capital requirements and all that existed in was wool said that was followed it was audited and reviewed regularly by an entity.

We probably wouldn’t have been in that situation now that’s not always true because of the banks regulated, and we all live through 2008 so.

regulates reject everything doesn’t protect everything but it allows guardrails to.

Help us as we evolve and and define that space, the space ahead, so I think we’re going to see more of it obviously it started off with the executive order from Biden earlier this year.

Then you saw the Department of Labor coming with something to see FTC the SEC all the all major agencies are going to make stances and.

Protocols around this and I think we’re going to start getting some really nice guidance, which is going to help us grow.

Because for the guy that’s sitting on the sideline and it says, you know it’s not regulated it’s not for me i’m i’m not going to tell him otherwise that makes sense it’s usually pretty proven strategy.

bitcoin will have much more mainstream adoption and so will will crypto when people feel a little bit safer in the space to right we feel safer than we did, eight years ago, but but eight years from now we’re going to feel even safer that’s the beauty of this evolution.

Scott Hawksworth: You know I couldn’t agree more, and you know you mentioned a few of the big big events that that you know more regulation might have provided more protections for consumers.

You know, there was the big ust story as well, and you know there’s still folks that are in the crypto space that are you know flying fast and loose.

With with the lack of regulations that we do have so Like you, I applaud regulation, I think that’s good for crypto and clearly we’re we’re going that way now will there be.

You know, maybe some overzealous regulation depending of course that’s a that’s a possibility, but by and large I think that’s going to make.

The crypto industry better and that’s going to make it a better investment, because then you have that greater support and protection right.

Chris Kline: yeah absolutely.

Scott Hawksworth: So I guess speaking to this, you know there’s a lot of discussion around crypto adoption and the mainstreaming of crypto and I believe it was just yesterday.

You know BlackRock is partnering with coinbase got it right here to provide greater support for institutional investment.

In crypto are, of course, have a link to this on our show notes what’s your take on on this as part of the larger crypto adoption when you see you know institutional investment starting to come in more and more, even in spite of economic uncertainty.

Chris Kline: ya know it was funny I was watching that yesterday and the spike of price happened at coin basis stock.

yeah and that announcement and not on crypto crypto has ran a little bit this morning, obviously So these are all positive news things that we need a cycle good things it’s been.

The second half of the second quarter was pretty much just one after another, almost the crypto space felt a little radioactive right.

So this is great I think now what I, and I know coinbase guys will probably agree with me is that an institutional adoption like this with black rock is amazing it’s great.

But never forget that retail drives this emerging technology, the interest in the retail person about what crypto can do for the future of money.

A coupled with their concerns about the old money that we use today and it how it’s being managed what its value looks like etc all those things.

The retail buyer drives a lot of crypto so it’s great to have the institutions around i’ve loved it.

everybody’s loved it last year with tesla starting at ilan Michael Taylor micro strategy of tech even a country down in El Salvador everybody was it has jumped into this building a balance sheet around it.

What that does to the space which people are kind of feeling now is it we have always thought of ourselves as D correlated from the rest of this of the economy right for those different.

But right it’s when it’s invested by institutions institutional players have a habit of treating everything like a stalker or an equity.

So that’s that’s why you see these swings and a lot more of a correlated nature between stocks and crypto this year, in particular, in the last six to eight months.

So that comes with it, because then that that’s the way they trade them but everybody loves to see institutions kind of play.

What i’m really interested about is this balance between new bank and old bank in the next three years, so these new banks like Robin Hood and these ones with mobile Apps that everybody could go to a attracted a younger generation.

They burst on the scene everybody in 2020 was born, so they all started trading stocks on these Apps right that was when it was happening.

And now old banks JP morgan’s the Charles Schwab fidelity to the World day are catching up on the technology part of it and.

it’ll be interesting to see who wins in that battle, because some of the new banks don’t have that longevity.

of risk and security and management and other things, and so the brands, will the the.

The buyers will go towards brands they feel safe with so there’s a lot happening it’s it’ll be an exciting time this is just another piece of the resilience and relevance that purpose defined for itself in the last decade.

Scott Hawksworth: You know I think that’s that’s such a good point you make about you know where crypto has come from to I think that that.

That ethos, the the that it really began with with retail investors that’s that’s what what drove all of this with crypto and so as institutional investors come in, I do think that’s a good thing, but.

it’s again going to be driven by you know individuals, because, and I think that speaks to you know your platform and what you’re doing it at bitcoin IRA right.

Chris Kline: yep absolutely a lot of our early adopters they weren’t just nerds right that we had NASA scientists, we had IBM guys made everybody from fang.

Those were early adopters, but they were also very independent minded they just wanted to make sure that they were part of the next revolution and they, and I think we all see a little bit.

In our generation for sure that this this doesn’t last forever we we’ve been effectively been creating more money for the balance sheet.

Not just here in the US, but everywhere, everybody follows through the ECB, the Japanese manga central bank that all of them, so we’re.

Ending balance sheets expanding the balance sheets and eventually that breaks and we’re already seeing practice with inflation at near double digits and it’s not transit oriented we’re gonna have to endure it for a while.

Scott Hawksworth: Oh it’s not.

A baby keep telling us transitory.:

Chris Kline: As I keep saying that changing the definition of a recession, these days, so you know.

Scott Hawksworth: The goalposts wherever they need to move them.

Chris Kline: Exactly exactly, but these are the real things that happen when you print money for so long into the end it’s and we’ve seen modern day.

Modern day and historical references everybody can go to the y mar Republic, Germany 1920s right guys we’re going down to buy groceries wheelbarrows full marks and the grocer took the wheelbarrow and through the marks in the.

Scott Hawksworth: In the street like trash.

Right, I was like a wheelbarrow is good yeah exactly.

Chris Kline: i’m good with the wheelbarrow this is useless to me.

That that happened also more modern in Turkey, with its devaluation of its currency and you saw a huge run of wallets in bitcoin setups in that ecosystem and that IP area during that time and then more currently.

Venezuela and what they’ve had with hyperinflation is just I don’t know if you were at the Miami conference in June and a couple years ago.

They had the first one, they didn’t mind me they got a dumpster was big dumpsters full of Venezuelan boulevard and nobody took it is millions of dollars of it in there, and nobody stole any of it, I mean maybe one for like a souvenir but nobody.

Scott Hawksworth: there.

Chris Kline: And that, and that can happen to anybody because of how you manage your currency i’m not a doomsday air, but we are we don’t have a lot of weapons to this, you see what’s happening, the Fed is basically rate right raising rates to make it.

fun to make based in capital more expensive, which will.

help drive drive some of those tools that have been created and basically reversing the injection of these.

But it’s if you’re going up a quarter of a point a half point three quarters of point, maybe one point but.

Inflation is just smiling and barreling through like a freight train and we went from four, six and now almost 10% since I first started talking about it this time last year I was on cnbc and I said.

One of the big concerns I have for next year’s inflation and they laughed at me and I was like.

Scott Hawksworth: damn I.

Chris Kline: can get out of hand really fast and and it really happens quickly and then and so that’s the part that kind of I think everybody’s thinking about is that.

How far will my dollars go, we all know, everything’s gotten more expensive in our lifetime and now it’s really getting accelerated in that fashion.

So people are wondering how far can I stretch my dollars and making next to nothing on your bank account savings account is not going to add up you’ve got to find alternatives.

Scott Hawksworth: I mean, again I couldn’t agree more, you know when I drive my daughter today care in the morning i’m always looking at just the gas prices, I go by, you know, several gas stations I go.

Interesting you know, and so I think that that.

really does speak to this environment we’re in now, one thing i’m curious to get your perspective on is.

As all of this sort of started to happen in the beginning of 2022 and you know the it finally you know the chickens came home to roost in terms of inflation and and this this sort of economic.

shocks that we continue to take when it comes to you know pandemic and then you know war in Ukraine, all of this.

I was surprised that the crypto markets behaved like risk assets like like fang stocks in a lot of ways, and you know I thought, well, I.

I thought you know of course bitcoin is clearly a hedge against inflation, you know why isn’t it going up and response.

i’m curious what’s your what’s your take on how crypto itself has responded in this environment, even if long term, you know it clearly there there makes so much sense for crypto the short term response i’m curious to your take there.

Chris Kline: yeah absolutely I mean I think one of the big things to do is be a little patient because inflation hedge is don’t just show themselves instantaneously right he.

goes over time and gold is behaving weird to.

It was it was almost a 2000 at the beginning of all this chaos and now it’s sitting around like 17 and when even as low as I think like 1619 so.

gold put the traditional hedge against inflation is acting somewhat weird and these crazy times.

I think part of it is is led to the institutional money that’s involved right that’s swinging it and making it to behave like an equity or like one of the things stocks are tech stock like you mentioned.

Now, moving forward over time, where I think we’re going to see the decoupling occur it’s it’s a it’s a patient’s play I go back to March of 2020.

When everything fell off because everybody thought the economy was literally going to end and we should we’re shutting everything down.

bitcoin pulled just below like I think it almost gotten the $5,000 territory, like $6,000 territory, now it recovered very quickly and still if you think about it from buying it that low to where it’s at today is huge games.

Stocks went down to about 20 and pretty much gotten right back to where they were at before Kobe that’s basically where they’re at as far as some of the index values so.

If you look at it, if you’re in doubt about the the the behaviors of the asset zoom out and you’ll see some of those make more sense.

But in the short term there’s also a lot of things that we that are that you can’t take out it’s not a vacuum right so you’ve got liquidity calls you got margin calls on some of these big things have happened this year.

luda etc you’ve got institutions holding billions of dollars anytime any of those off load of.

position and some of them will as we’ve shown with tesla and otherwise it’s going to have an impact swing on on this space because it’s not as big as we want it to be yet.

But these are part of the cycles, we also have what I love is right in the midst of inflation, which is likely just going to keep accelerating.

we’re going to have a having we’re going to having to me and it’s going to be it’s always a buzz and woody talks about it.

Other than when it occurs, but this is the anti inflationary mechanism that makes bitcoin great it’s The thing that takes half the reward away to everybody that’s producing it every every so.

Number of blocks, so that eventually there’s a diminishing return return and we only have 21 million it’s Conversely, the.

Currency we have is US dollars and fee is the guys that are producing it, are being rewarded with re election campaigns, every time they had more money into the into the space, so we.

We haven’t seen the reality of this yet and it’ll come over time, but it’s going to slowly embed itself into our lives you’re going to see more adoption I think you’re really going to start seeing.

luxury good items shipped to it soon as well you’ve already seen things like real estate private jets etc and accepting bitcoin or as a payment or as collateral of a payment or alone.

The exciting space, when you start seeing pop into those areas so just a patient’s game, I was saying way you know, I was like man, I was so right about inflation, but I was so wrong about what bitcoin would do.

Scott Hawksworth: In inflation right.

On that one yeah.

Exactly, but you know I think even looking at you know we’re talking bitcoin even looking at the price, you know it just helps it.

kind of hung around that 1920 and I looked at just before our discussion here, I think it was at 23 just at the time I was looking at it.

And he’s like well you know it didn’t drop further and now, of course, it can go either way you know not neither of us have the crystal ball, but that’s a sign of some kind of like well that’s interesting, so I think that that that speaks to your point of the the the long game.

Chris Kline: The patient, I think I think there’s somebody got on his wall that I know that all every article that says that bitcoins been dead since like 2009.

And in here he’s already had to move to another wall.

You know it’s it’s it just it’s a reality there’s this is this emotional asset.

there’s there’s people on each side of the spectrum there’s not a lot of Gray area, you know there’s that’s the mainstream adoption that’s happening, but you either love it or hate it or you think it’s crazy.

You got the buffets of the world you’ve got people that switch Jamie diamond that went from it’s a fraud to is this Peter schiff a big gold guy thought it was crazy now he shifted his policy on it, so you know.

that’s why I try not to throw out forecast I plus my compliance officer would kill me if I do.

Scott Hawksworth: Oh yeah.

Chris Kline: But, but if you look at this if you’re ever looking in crypto and you’re wondering about the.

short term don’t make your decisions on the short term it’s a, this is a long term game, a lot of the folks that.

web why the IRA made so much sense for books was their long term modelers This is something that.

I have in my IRA my daughter, has it in her Roth, and I hope she’ll users for college at some point, but I hope that I just get the hand mind down to her and never have to use and watch it grow a lot, like the way my grandfather looked at his gold coins in the safe.

Scott Hawksworth: Right right, you know we’re talking about nfc is and we talked about the the sort of doomsday predictions we actually recently had an episode last month, where you know we just asked the question or nfc is dead and we came up with no they’re not.

Chris Kline: Absolutely not.

Scott Hawksworth: But I think that that does speak to sort of that short term thinking and a lot of folks you know.

Just start reaching for the lifeboat just because they read a few articles and everybody’s saying the sky is falling and and I think that long term view and especially when you’re talking about retirement.

is really important to keep in mind and, of course, balancing your portfolio, making sure you’re managing your risk talking to your financial advisors, you know consult your professional before investing in anything do your research but keep that longer term.

Chris Kline: view of course right.

Absolutely, and like I said earlier, getting off zero is paramount having some exposure to the space it’s just the experience of understanding how wallets work he’s were considered.

Imagine if you just were like doing checks back in 1990 and cash only and you just never you’re like i’m never doing it.

You wouldn’t be able to survive in this economy today, you have to have credit cards, you have to have debit cards, you have to have PayPal and then mono.

it’s a reality it’s how exchange occurs and it bitcoins embedded itself in that space and it’s going to be i’m excited to watch what happens next.

Scott Hawksworth: me as well and and everyone here at cryptic is Chris I want to thank you so much for joining me on the show today as we wind down our discussion here, I always like to you know, keep that future focus so what’s next for bitcoin IRA and if folks want to find out more where can they go.

Chris Kline: So what’s next for us we’ve done a lot of firsts for the last seven years first first ever big one, I rate first trading platform self serve platform dashboard.

earned program mobile APP what we’re going to do this year we’re really focused on this year is.

refining and polishing so we’ve built a really great system but yes, if you’ve ever built fintech yet the.

client facing component is the most important facing component and then behind the scenes in the middleware and in the back office.

You kind of string things together right because you’re moving so fast and staying at first to market so we’re doing a lot of that and we also have a really big higher in just two weeks that’s coming won’t give it away but it’s from a major financial institution that’s coming on.

Scott Hawksworth: On all our G sweet.

Chris Kline: And we haven’t seen a lot of the so we’re happy to be good news in the space you’ll you’ll see it in the news producer and the next week or so I think it’s about the 15th you’ll see it and then for.

retire for crypto in general, this is a case study of human empowerment I think we’re going to see it spread internationally, just as fast as we’re seeing in spread domestically.

The El Salvador case study is it’s this country is not falling apart because these crypto prizes is nothing, this is a compassionately of epic proportions are not sending an aid from all over the world and and have fema trucks and food trucks there they’re doing fine.

And I think you’re going to see more of that Central America spread.

The idea of basically this their second chance that these guys, most of these countries, these low GDP hell bound down by years of by their colonialism monarchy or or cruise or natural disasters and sometimes our worst case with with with volcano.

Is a chance to stand on their own and say this is how we’re going to do, I love what they’re doing there you’re going to see more States here us wise play with this i’ve already I know personally i’ve talked to.

treasurer’s or governor’s offices in several States about they’re looking at stable coins they’re looking at.

What all these moving parts means so that they can better equip themselves for things that they may want to use it for as a state economy.

or things that they want to make sure that they regulate safely, so I think we’re going to see everybody else come to the table and it’s going to be an explosive growth period for adoption, which should inherently.

Dr price in adoption of other assets you’re going to see more points come in you’re going to see still more sad bad stories you’re going to have people that lose their crypto because of hacks people that choose the wrong platform.

you’re gonna have bad actors that do crazy things that happens everywhere we just it kind of seems to get a really tight microscope on it when it’s crypto related but it happens everywhere, and so you need protect yourself and watch, for your security.

If you are using to FA which I bet every one of your users is on everything in your life do it i’m a big movie guy so that’s all I use is you wikis on everything for access.

So security’s gonna get harder and harder the 2020 with the coven was a big peak and cyber security thefts and crimes and it just keeps accelerating it’s going to be the new thing we have to manage.

and hopefully I believe there’s a lot of crypto solutions that are in development are already in place that could do such so this may be a place where we start realizing about privacy and security again due to the advent of some of these crypto initiatives.

Scott Hawksworth: 100% 100% it’s going to be really exciting to see and they’re going to be absent flows and and challenges, but also a lot of victories out there.

That, I think people are going to see Chris Thank you again so so much and again if folks want to connect and they want to find out a bit more maybe they want to want to make crypto part of their IRA where can they do that, where, should they go.

Chris Kline: easiest is the mobile APP you can go to the APP store or the Google play store and download the mobile APP and that right there it’ll help you start an account.

US us about three minutes you go through you put in your details securely provide the forums that needs securely and then our team will kick in and help you fund it so if it’s from a rollover transfer or a new account contribution.

And then, once those ones arrived you’d be able to trade you if you’re not comfortable on the phones, you can also use desktop version that’s fully built out as well, so that’s bitcoin ira.com or the big one IRA APP in the excellent.

Scott Hawksworth: And we will have links to all of that, in our show notes on cryptogic.com. Thanks Chris.

Chris Kline: Thank you.

Scott Hawksworth
Scott Hawksworth

Hailing from Evanston, Illinois, Scott is co-founder of Cryptogic as well as host of the several popular crypto podcasts.