Fidelity Investments has introduced a new Individual Retirement Account (IRA) that allows clients to invest in cryptocurrency. This plan provides the opportunity to purchase Bitcoin, Ethereum, and Litecoin, while keeping digital assets in cold wallets.
This is reported by Business • Media
According to the terms of the new retirement plan, it is available to U.S. citizens who are at least 18 years old. Investments are made through a traditional brokerage IRA, with Fidelity Digital Assets acting as the custodian and intermediary for transactions involving the purchase and sale of crypto assets. The spread cost is 1%, and there are no fees for opening or closing accounts.
Retirement Plan Options
Clients can choose from one of three options for the new IRA:
- Roth IRA: no capital gains taxes are charged;
- Traditional IRA: this plan allows for the deferral of income tax payments;
- Rollover IRA: a transitional option for those looking to switch from a traditional 401(k) plan to a cryptocurrency plan.
In a comment to CoinDesk, a representative of Fidelity Investments noted that this initiative is a response to the growing demand from clients interested in crypto assets. Fidelity Investments became the first major company in the U.S. to offer clients with 401(k) plans the opportunity to indirectly invest in cryptocurrencies. The changes were implemented in April 2022, despite opposition from the then-current White House administration.
Initially, the investment option was limited to Bitcoin, with no more than 20% of retirement savings allowed to be allocated to this cryptocurrency. In December 2023, ahead of the approval of spot Bitcoin ETFs, experts predict that the launch of these products could lead to significant changes in retirement plans.
“Fidelity Investments became the first in the U.S. to allow clients to allocate a portion of their retirement savings to crypto assets.”