Fidelity’s industry-first bitcoin 401K plan attracts more fintech companies
Cryptocurrencies in the 401K plan.
Basically, a 401K plan is a retirement savings plan offered by many US employers that has tax advantages for the saver. It is named after a section of the US Internal Revenue Code. When a worker enrolls in a 401(k), they consent to having a portion of each paycheck go directly into an investment account. Part or all of the investment can be matched by the employer. The employee has a variety of investment alternatives, most often mutual funds.
Lately, employers are also pushing to provide employees with additional options to invest in cryptocurrency through the 401k plan. Fidelity Investments is one of the pioneers to offer the first-ever bitcoin-related 401K plan and pushed cryptocurrency into the investment management industry. As Fidelity has stepped up in the game, giving employers an option for bitcoin investments, many fintech companies have also followed suit and come up with their own plans to offer employees.
According to reports, Bitcoin IRA has started allowing customers to renew the 401K plan, allowing them to trade and invest in cryptocurrencies such as bitcoin. ForUSAll is another company that has started offering cryptocurrencies in 401k plans. Swan Bitcoin will also allow customers to use their retirement accounts to purchase bitcoins.
Fidelity’s steps into cryptocurrencies.
Fidelity Investment then announced in April that the company would offer 401k plan employees the ability to invest in bitcoin through digital asset accounts. The news was celebrated around the cryptocurrency market, as Fidelity was one of the first companies to push digital assets into retirement accounts, also allowing seniors to enter the crypto market.
It was also reported that employers who intend to join the Fidelity Group’s new 401k plan group must do their due diligence and obtain the necessary approvals before they can offer the plan. The process is expected to take several months, according to a Fidelity spokesperson.
Among Fidelity customers, MicroStrategy was the first company to sign up for the new 401k plans. According to the beliefs of Fidelity, it is reported that more and more companies intend to join the company. According to Fidelity, the first employers to include a Bitcoin option in their 401(k) plans will do so in the fall.
The decision made by loyalty investing is rather brave, considering the lack of technological information regarding cryptocurrencies among the older generation of people. But the decision will surely help the cryptocurrency market flourish in the long term and give the industry a good chance to revolutionize the financial sector.
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