Fidelity Investments made waves in the retirement-planning industry when it became the first of the major record-keepers to roll out Bitcoin for 401(k) plans. But fintech start-ups are moving in as well.
In April, Fidelity said that some of the 401(k) plans it administers would soon offer employees a way to invest in Bitcoin through dedicated “digital assets accounts.” The plan administrator, which oversaw $2.7 trillion in 401(k) assets spread over 20.4 million investors as of Dec. 31, is waiting to see which employers sign up for the Bitcoin option, according to a person familiar with the situation.
Employers that are considering adding Bitcoin to their 401(k) plans need to do due diligence and obtain the necessary approvals before they can offer it, the person said. This process can take several months, while Fidelity would need about 90 days to implement it, the person said.
MicroStrategy (ticker: MSTR), a software company, was the first company to sign up. But more are expected. Fidelity said Thursday that it has seen strong interest from employers. “In fact, client interest has not only been strong, but also spans across a wide range of industries and company sizes,” it said in a statement.
Fidelity said the first employers to offer a Bitcoin option in their 401(k)s will make it available in the fall.
The investment management company, meanwhile, has faced pushback from Congress and the Labor Department, which has reiterated warnings about the dangers of crypto in 401(k)s. Fidelity said it is continuing a “respectful dialogue” with regulators and policy makers.
While Fidelity was the first major plan administrator to offer a Bitcoin option for 401(k)s, several fintechs have offered crypto access to consumers, or plan to do so, mainly through individual retirement accounts.
