How to Buy Crypto with TD Ameritrade (2024)

Summary: TD Ameritrade doesn't support cryptocurrencies as an investment option on its platform. Instead, it allows investors to enter the digital asset space indirectly via investment vehicles like ETFs and futures contracts that are linked to crypto performance. This indirect route often comes with additional costs and potential counter-party risks.

For those TD Ameritrade customers looking to delve into direct crypto trading, Kraken emerges as a commendable choice. Adhering rigorously to regulatory frameworks set by U.S. bodies such as the FinCEN, it ensures a compliant trading environment. It boasts an extensive range of over 200 digital currencies available for trading and staking purposes.

Can I Buy Crypto with TD Ameritrade?

No, TD Ameritrade does not provide the option to purchase cryptocurrencies directly on its platform. While direct purchases of digital currencies are not facilitated, the platform offers access to Bitcoin ETFs for clients. For direct crypto transactions, TD Ameritrade clients would need to utilize a dedicated U.S. cryptocurrency exchange that adheres to Financial Crimes Enforcement Network (FinCEN) standards, ensuring compliant transactions.

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How to Buy Crypto with TD Ameritrade Alternative

While TD Ameritrade doesn't offer direct cryptocurrency trading, clients can use Kraken, an investment platform compliant with FinCEN regulations and accepting deposits in US dollars. Kraken allows for straightforward and free USD deposits, offering access to over 200 digital currencies with attractive rates.

For TD Ameritrade clients interested in Kraken, here's how to proceed:

1. Account Creation: Visit Kraken's website to set up a new account.
2. Bank Integration: Link your bank account for free USD deposits.
3. Crypto Selection: Explore Kraken's wide range of digital currencies.
4. Investment Action: Decide how much to invest, pick your desired crypto, and finalize your purchase.

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What are the Fees?

Engaging with TD Ameritrade for trading, including those related to cryptocurrencies, comes with its own set of charges that traders should consider. These include commissions for trades, contract fees, and potential account maintenance costs. The specific rates can vary, with trading fees generally ranging from $0.65 to $2.25 per contract, depending on the type of trade and account.

For TD Ameritrade clients looking at direct crypto investments, Kraken stands out for its competitive fee structure. Starting at just 0.16% for maker fees, it offers more advantageous terms than some alternatives, such as Coinbase, where fees might exceed 2%. The advantage of Kraken is underscored by its free USD deposit options, including ACH transfers, positioning it as a prime choice for those in the U.S. seeking to invest in cryptocurrencies.

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Will TD Ameritrade Offer Real Crypto Assets?

Currently, there's no indication that TD Ameritrade is planning to provide direct access to real cryptocurrencies in the immediate future. One of the main challenges would be the need for a secure and robust infrastructure to safely store digital assets for both individual and institutional investors.

Creating such an infrastructure would necessitate significant investments in technology and security measures, something TD Ameritrade has not publicly committed to. Therefore, it's reasonable to expect that TD Ameritrade will continue to concentrate on its existing range of products and services, which don't include direct crypto-asset trading.

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Bottom Line

In summary, TD Ameritrade offers a gateway to the cryptocurrency market through indirect investment options like ETFs, catering to investors looking to explore digital assets without direct exposure. However, for those keen on direct cryptocurrency trading, Kraken provides a viable alternative with its adherence to U.S. regulatory standards and a wide selection of digital currencies.