Fidelity to allow its customers Bitcoin retirement accounts
One of the key players in the American market of pension investment programmes, Fidelity Investments, announced that it provides an opportunity for its customers to deposit 401 (k) bitcoins on their accounts.
The idea that people could accumulate not only fiat, but also cryptographic currencies has been in the air for a long time: “crypto” in recent years has received not only millions of new users, but also new dollar millionaires who were able to “retire”at a young age.
Fidelity serves tens of thousands of employees in 23,000 companies, and the company’s total pension fund is over $1.4 trillion. That’s almost 20% of all 401(k) plans in the US, which in turn make up 20% of the entire US pension market. By 2020, more than 60 million people were participating in 401(k)-programs, according to CNBC.
The features of the Digital Assets Account from Fidelity include the ability to buy digital assets without opening a specialized account on a cryptocurrency exchange, as well as the need for the consent of the employer that his employee will direct part of his pension contributions to bitcoin.
The US Department of Labor predictably criticized the idea, citing “significant risks and problems for members’ pension accounts, including risks of fraud, theft and loss,” in their letter.
Dave Gray, head of pension offerings and platforms at Fidelity Investments, responded that the agency, while pointing out the problem areas, “did not provide any guidance on how pension plan fiduciaries should solve these problems or fulfill their responsibilities when considering investments in cryptocurrencies.”
Also, the Fidelity representative accused the Department of Labor of imposing its own opinion on cryptocurrencies, the right on it should be certainly retained by the sponsors of pension plans. Mr. Gray also expressed confidence that the new Fidelity account eliminates many of the regulator’s concerns.
It is noteworthy that at the same time, MicroStrategy CEO Michael Saylor also said he would offer his employees the opportunity to invest in bitcoin within his 401(k)-pension portfolio.
A further “domino effect” looks inevitable, so it can be called the next stage of the global corporate adoption of cryptocurrencies.