Fidelity will allow its retirement plan clients to invest in Bitcoin – DiarioBitcoin

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Fidelity will allow its retirement plan clients to invest in Bitcoin - DiarioBitcoin For Hannah Perez

Americans saving for retirement will be able to allocate up to 20% of their 401(k) accounts to Bitcoin. Although regulators are not very convinced.


The American company specializing in asset management and pension funds, fidelityis moving to allow its clients to allocate part of their retirement savings to Bitcoin.

As reported New York Timesthe giant provider of pension plans will allow its clients to put Bitcoin in their tax-deferred 401(k) retirement accounts, as long as their employers allow it. If employers allow it, workers with accounts in fidelity they will be able to allocate up to 20% of their retirement savings to cryptocurrency.

Measure could bring millions of people in America closer to Bitcoin. fidelity is the nation’s largest provider of 401(k) plans and administers pension programs for employees of almost 23,000 companies. By 2020, it had $2.4 trillion in 401(k) assets under management.

Growing demand from savers

It should be noted that a 401(k) is a company-sponsored retirement savings and investment plan that provides employees with a tax exemption on the money they contribute. Contributions are automatically withdrawn from employees’ paychecks and invested in funds of their choosing.

According to the report, the new product is expected to go live between June and September this year. Dave Gray, Head of Workplace Retirement Offerings and Platforms at fidelity He said the product grew out of growing customer interest and demand for offering digital assets in a retirement plan. In a separate interview for Wall Street Journaladded:

There is a need for a diverse set of investment products and solutions for our investors. We hope that cryptocurrency will shape the way future generations think about investing in the short and long term.

Gray also announced that the offer would be limited to Bitcoin and would not consider other cryptocurrencies, at least initially; although it could consider other options according to the demand of the clients.

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Meanwhile, reports indicate that the firm MicroStrategydirected by the enthusiast of BitcoinMichael Saylor has already accepted the initiative. fidelity He also indicated that he is in talks with other employers interested in the product.

Regulators are not convinced

The new offer fidelity is not without its critics as regulators have expressed skepticism. Just a few days ago, the US Department of Labor, which regulates company-sponsored retirement plans, noted in a blog post that the idea of ​​exposing 401(k) participants to direct investments in cryptocurrencies poses “serious concerns”.

The publication ofhe agency’s Employee Benefits Security Administration Acting Deputy Secretary Ali Khawar cited the “serious risks” that exposure to such assets may bring, including valuation concerns, obstacles to making informed decisions, price volatility and a still unclear regulatory landscape in the country.

Despite the agency’s denial, fidelity it is not the first retirement plan provider to dabble in cryptocurrencies. as reported DailyBitcointhe signature Digital Asset Investment Management (DAiM) launched in 2020 the first 401(k) retirement plans backed by Bitcoin. also the supplier ForUsAll partnered last year with coinbase for offer exposure to Bitcoin to their holders of retirement savings accounts, as recalled Cointelegraph.

The interest of fidelity in the industry could definitely drive adoption among a larger number of people. Despite being primarily known for its pension business, the company stands out as one of the early entrants into the crypto space. In 2018, it began offering digital asset trading and custody to institutional clients, and in 2020, it introduced a private equity fund. Bitcoin for accredited investors. It also has an exchange-traded fund (ETF) of Bitcoin which launched in Canada last year.

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Article by Hannah Estefanía Pérez / DailyBitcoin

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WARNING: This is an informative article. DiarioBitcoin is a means of communication, it does not promote, endorse or recommend any investment in particular. It is worth noting that investments in crypto assets are not regulated in some countries. May not be suitable for retail investors as the full amount invested could be lost. Check the laws of your country before investing.

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