Bitcoin IRA Complaints Increase After You Knock Out Earn and Add Altcoins
Bitcoin IRAs (Individual Retirement Accounts) seemed like a simple concept to investors, especially those used to other types of retirement plans. So easy, in fact, that in March 2021, when bitcoin passed $50,000, the company named Bitcoin IRA boasted of having gained 100,000 customers.
And it soon expanded beyond its bitcoin namesake. By the end of the year, it also allowed customers to buy ether, litecoin, bitcoin cash, stellar lumens, zcash, and even non-crypto assets like gold.
In fact, Bitcoin IRA today boasts that clients can invest in more than 60 cryptoassets and various non-cryptoassets.
But despite its rapid growth and grand claims, it is a few signs that not everything is going brilliantly for Bitcoin IRA.
The site’s ‘Earn’ page, which promised investors up to 6% interest on cash and crypto in their retirement fund, is also no longer active. Not only this, it appears to have deleted a number of eyebrow-raising revelations.
This is in addition to Bitcoin IRA being embroiled in a number of legal battles initiated by customers who alleged deceptive practices. It has also reported complaints about poor customer service and even lack of funds.
Bitcoin IRA and Kingdom Trust battle in court
In August 2019, Bitcoin IRA and its affiliate, Digital IRA, entered into a legal battle with custodian and trust company, Kingdom Trust. Bitcoin IRA alleged that Kingdom Trust prevented clients from transferring their retirement accounts to its own custodian, BitGo.
Kingdom Trust, in turn, had filed a lawsuit against Digital IRA and Bitcoin IRA just days before. In the suit, Kingdom Trust alleged that the Bitcoin IRA stole trade secrets who belonged to it and conspired to defraud the customers.
Kingdom Trust had planned to merge with BitGo in January 2018. The lawsuit alleges that it shared information and secrets, including lists of clients and internal policies and procedures, with BitGo as part of preparations for the merger. However, BitGo terminated the agreement in May 2018.
A year later, in May 2019, BitGo Trust forged a third-party administrator agreement with Digital IRA. Kingdom Trust claims that BitGo shared the confidential information with Digital IRA as part of a conspiracy to lure its clients away.
Read more: a16z’s crypto bets crumble, early investors still profit
Customer complaints are increasing
On June 22 of this year, a Bitcoin IRA client complained about a 1% fee for making an in-kind transfer of assets to another IRA company. Bitcoin IRA claimed it had disclosed this 1% fee in an email. However, the client said it was a marketing email that customers could opt out of, making it useless from a legal point of view. Ultimately, the client received a fee refund.
On November 22, 2021, another customer alleged that Bitcoin IRA refused to process the requested transfer of assets to another IRA company. The client requested the transfer in September 2021 and had a conference call with Bitcoin IRA on October 15, 2021.
Bitcoin IRA continued to give the customer the runaround, claiming that the transfer was a complicated process or required sign-offs from various managers. After filing a complaint with the Better Business Bureau (BBB), the Bitcoin IRA transferred the funds as requested.
Bitcoin IRA has a two-star rating from four reviews officially filed with the BBB. Its negative reviews complained about lost funds, mishandling of documentation or misleading marketing of a purported “free” account that did not exist.
Bitcoin IRA sounds like a good idea in principle. People with a retirement account can add digital assets to it. However, it’s not just bitcoin, and as a company, Bitcoin IRA doesn’t look all that impressive when we consider the allegations of stealing other companies’ confidential information, engaging in deceptive marketing practices, and mistreating customers.
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