> purchased his founders’ shares in PayPal through his Roth IRA during PayPal’s formation."

> That's literally the market rate.

That's not a market rate, that's a price-fixed rate. A market rate involves actual buyer and seller transactions and an actual market (a couple of people shuffling stock amongst themselves does not a market make)

If he had put Bitcoin in there at $0.01 back when it was trading at $0.01 - that would be a market rate transaction (since there was a market for Bitcoin at the time). That would have been much less problematic than what actually happened (and there would be no "substantial control" problems either with the Bitcoin investment).

It gets philosophical, but founders equity has a lot of characteristics that I’m sure the government was not thinking of when they made the Roth IRA rules. For example, Thiel’s time was a massive reason for him getting the equity he did, so he was able to use $x of Roth IRA money and $100*x of his labor to transfer value into his Roth. What most people have to do is trade their labor for money, then transfer a capped amount of money into the Roth, and use that small amount to invest.

On top of that, as the other commenter said, founders equity doesn’t see the light of the market to have a fair value. And it wouldn’t shock me if Thiel waited until it was obvious PayPal would succeed (i.e. if presented to the market, his shares would be massively valuable) to transfer the stock in.