Fidelity allowing Bitcoin in 401(k) accounts a ‘great development’: Crypto expert

Domain Money CEO argues investors with long-term views may be well-suited

Domain Money founder and CEO Adam Dell told "Mornings with Maria" on Tuesday that Fidelity allowing Bitcoin in 401(k) accounts is a "great development" for the cryptocurrency industry. 

"It’s a recognition that investors are looking for access to this asset class and so we think it’s a great development for the industry," Dell told host Maria Bartiromo

Fidelity Investments confirmed to FOX Business on Tuesday that it will allow investors to add Bitcoin to their 401(k) retirement savings and investment plans and that the about 23,000 companies that use the financial services corporation to administer their retirement plans will have the option to add the cryptocurrency later this year.

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The company said the move would make Fidelity the first major retirement plan provider to offer such an option and would allow investors to allocate as much as 20% of their nest eggs to bitcoin. However, that threshold could be reduced by plan sponsors. 

Fidelity to allow Bitcoin in 401(k) accounts  (iStock / iStock)

Dave Gray, Head of Workplace Retirement Offerings and Platforms at Fidelity Investments, noted in a statement that "there is growing interest from plan sponsors for vehicles that enable them to provide their employees access to digital assets in defined contribution plans." 

Ticker Security Last Change Change %
COIN COINBASE GLOBAL INC. 69.87 +2.70 +4.02%
BITQ EXCHANGE TRADED CONCEPTS TRUST BITWISE CRYPTO INNOVATORS E 8.03 +0.25 +3.21%

Dell offered the insight on Tuesday as bitcoin traded around $40,000, down from its all-time high of over $68,000 reached in November 2021.

Bartiromo noted on Tuesday that crypto has been incredibly volatile in recent months and asked Dell if investors would be put in jeopardy by adding the digital currency to their retirement accounts. 

"Despite the volatility associated with cryptocurrencies as an asset class, as an investment opportunity, the long-term prospects of these technologies and what blockchains can do to our underlying banking systems are quite significant," he responded. 

"And so investors who recognize that opportunity and have a long-term view may be well suited to use their 401(k) as a vehicle to invest in those."

Dell added that "each individual needs to determine for themselves what level of risk is appropriate given their situation." 

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He noted that "some experts suggest between 2 and 5% of your investable assets makes sense to put into cryptocurrencies." 

"Our view is that the long-term prospects of blockchain technologies are meaningful and the opportunity set is quite large," Dell added.

"Innovations that typically come along, you either have to be a venture capitalist or wait for the companies to go public in order to participate. That’s not the case with cryptocurrencies," he continued, stressing that people "can invest today in the technologies that make up the banking system of the future."

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