Fidelity’s New 401(k) Offering Will Invest in Bitcoin (Published 2022) (2024)

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Fidelity’s New 401(k) Offering Will Invest in Bitcoin (Published 2022)? ›

The digital assets account will become widely available in the middle of this year, Fidelity said. It will be integrated into the 401(k) investment menu, just like more traditional mutual funds; investors may elect, for example, to dedicate a certain percentage of their contributions to the Bitcoin account.

Fidelity Investments, the largest 401(k) administrator by assets, began offering a bitcoin fund to workers this fall. ForUsAll started offering six cryptocurrencies to workers in recent weeks. The companies appear to be the first administrators of 401(k) and similar workplace plans to offer crypto.

With Fidelity Crypto^®, you can trade and secure bitcoin and ethereum with as little as $1. You'll get institution-level security and services that Fidelity Digital Assets℠ has offered since 2018.

Currently, there are means of accessing bitcoin through 401(k)s, including through Fidelity's Digital Assets Account, which has not caught on quickly, Edelman said. But the fact that Fidelity is among those with a spot bitcoin ETF is significant, given that it is one of the biggest retirement plan providers.

No third-party custodians

Any BTC or ETH you may purchase is stored by Fidelity Digital Assets using all the safety and security measures previously outlined.

The Fidelity^® Wise Origin^® Bitcoin Fund (FBTC) is an exchange-traded product that seeks to track the performance of bitcoin. FBTC provides investors with the opportunity to gain exposure to the price of bitcoin in a familiar investment structure that passively invests in bitcoin.

Fidelity Digital Assets℠ charges a spread of 1% on the execution price of buy and sell transactions.

Unfortunately, it's also incredibly volatile. For that reason, while current market conditions are favorable for anyone considering buying Bitcoin, it is an asset you should purchase only at your own risk. Because while Bitcoin may have the potential for significant returns, you may also lose most of your investment.

Bitcoin is a risky investment with high volatility, and generally should be considered only if you have a high risk tolerance, are in a strong financial position already and can afford to lose some or all of your investment.

How to safely earn interest on bitcoin? ›

Bitcoin One Year From Now

That said, Modulus' projections indicate that in one year, Bitcoin may rise to $96,000. “Were that projection to come to fruition, a $1,000 investment today could be worth approximately $1,333 in twelve months, though it could also become $750 if prices fall.

A $1,000 investment today could buy 0.0230 BTC based on a price of $43,403.20 at the time of writing. If Bitcoin hits $1 million as predicted by Wood Several times, the $1,000 investment would be worth $23,000, representing a return of 2,200%.

A $100 investment in Bitcoin could purchase 0.00607 BTC today based on a price of $16,466.14 at the time of writing. If Bitcoin hits the $1 million price target by Wood in 2030, the $100 investment would turn into $6,070. This represents a gain of 5,970% from now until 2030.

ForUsAll has no investment minimums, offers direct investment access to multiple cryptocurrencies in the 401(k), and provides ongoing customer support.

The financial giant will now allow customers to trade bitcoin, although they will not be able to withdraw it to self-custody. Customers of Fidelity Investments can now buy bitcoin through Fidelity Digital Assets.

Fidelity Crypto® is offered by Fidelity Digital Assets℠. Investing involves risk, including risk of total loss. Crypto as an asset class is highly volatile, can become illiquid at any time, and is for investors with a high risk tolerance.

In principle, there is no rule against holding cryptocurrency in a Roth IRA.