Bitcoin 401k? Fidelity Investments Says Yes
26 April 2022 - 7:00PM
NEWSBTC
Bitcoin has gradually been finding its way into every part of
society and its use as an investment vehicle has been the biggest
part of it. There has been some pushback when it comes to using the
cryptocurrencies in investment vehicles dominated by traditional
finance but even this is starting to wane. Evidence of this is in
the recent development from Fidelity Investments, which has
announced that it would be allowing employees to invest in their
401k using Bitcoin. Retire With Bitcoin The 401k is one of the most
popular investment vehicles aimed toward retirement for workers in
the United States. These are usually dominated by stocks that
appreciate over time while the account holder continues to pay into
the account as they work. As time has gone on, account holders have
begun to look towards other investment options to diversify their
401k investments and the latest stop is the pioneer cryptocurrency,
Bitcoin. Related Reading | Liquidations Surpass $300 Million
As Bitcoin Touches 40-Day Lows Fidelity Investments has announced
that it would start allowing employees to add the cryptocurrency to
their 401k accounts. This will make Fidelity the first major
company to offer the option to add bitcoin to its retirement plan.
The 401k is currently the country’s largest retirement-plan
provider and hosts the majority of the market share. About 23,000
companies currently use Fidelity to administer their retirement
plans and bitcoin will be available to employees of these
companies. BTC resting above $40,000 | Source: BTCUSD on
TradingView.com Fidelity announced that it will allow employees to
put as much as 20% of their 401k plan in bitcoin. The plan is set
to go into effect later in the year. The firm currently holds an
estimated $2.4 trillion in 401k assets in 2020 alone, accounting
for more than one-third of the total market share. Fees are placed
in the territory of 0.75% and 0.90%. This depends on the employer
and the amount being paid into the account. There is also a trading
fee but Fidelity is yet to disclose what this will be. Related
Reading | Cardano To Increase Block Size By 10%, Can ADA
Benefit From This Network Improvement? There is a need for a
diverse set of products and investment solutions for our investors.
We fully expect that cryptocurrency is going to shape the way
future generations think about investing for the near term and long
term.” – Head of workplace retirement offerings and platforms at
Fidelity. This decision comes after a directive from the U.S. Labor
Department which expressed concerns over adding cryptocurrency
options to retirement plans. This was based on the fact that these
digital assets remain largely speculative and very volatile.
Nevertheless, it seems that Fidelity’s offering is already starting
to catch on as MicroStrategy is rumored to have already signed on
to this plan. Featured image from Investopedia, chart from
TradingView.com
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