Fidelity’s crypto expansion and political pushback

Fidelity enables 401(k) participants to allocate up to 20% of their holdings to Bitcoin. While Fidelity allows 401(k) participants to allocate up to 20% of their savings to Bitcoin, Senators Elizabeth Warren, Richard Durbin, and Tina Smith sent a letter to CEO Abigail Johnson and called the asset volatile and speculative. I find the senators’ concern about retirees outlasting their balances valid, especially since the median 401(k) balance sits at $33,472. The senators argued that while 401(k) participants are fortunate to have a plan, many Americans lack the budget to contribute and must use wages for essentials. This move to allow such exposure benefits 23,000 companies that can now add Bitcoin to their investment menus. Fidelity also launched crypto-focused IRAs on April 2, which let US adults over 18 in eligible states invest in Bitcoin, Ethereum, and Litecoin. These accounts exclude residents of California and Oregon and use a 1% spread for transaction fees. For those who seek indirect exposure, Fidelity offers the Fidelity Crypto Industry and Digital Payments ETF (FDIG), which holds companies such as Block Inc., Coinbase Global Inc., Bit Digital Inc., Riot Blockchain Inc., and CleanSpark Inc.

Schwab, Vanguard, and BlackRock trajectories

Schwab plans to introduce spot crypto trading in the first half of 2026 after it tests the products with employees and a limited client group. The decision by Schwab to plan spot crypto trading for the first half of 2026 follows a trend where companies like Vanguard now permit clients to trade third-party ETFs from BlackRock and Fidelity on their own platforms. Vanguard changed its stance on December 2, 2025, to allow its 50 million clients to buy crypto ETFs from providers like BlackRock and Grayscale. This move follows a year where BTC ETFs saw $132 billion in inflows. BlackRock’s IBIT reached $70 billion in net assets in June 2025 and generated $245 million in annual fees by October 2025. This interest follows the re-election of Donald Trump, who is a vocal advocate for crypto. Rick Wurster, the Schwab president, noted that the firm aims to support clients interested in acquiring crypto assets as the regulatory landscape evolves.

The cost of holding Bitcoin in a retirement account

I skip the traditional Bitcoin IRA custodian because they charge fees that grow as your investment grows. One custodian charges a 0.05% monthly fee on the portfolio plus a $240 annual fee and a 1% transaction fee. These fees diminish your net gain as the value of your Bitcoin rises. You can use a Checkbook IRA LLC to avoid these costs. This method requires a $1,300 setup fee and a $208 annual fee. To use this, you must follow four steps: establish and fund a self-directed IRA, form and register an LLC owned by the IRA, open a business checking account, and open an account on a cryptocurrency exchange. The LLC must be 100% owned by the IRA to maintain tax-advantaged status. The income and expenses related to the assets flow through the IRA LLC as required by the Internal Revenue Service.

I advise you to verify the eligibility of your state before opening a Fidelity account. Many investors prefer self-custody via a multi-signature (multisig) vault to eliminate single points of failure. A Health Savings Account (HSA) also provides a triple tax advantage for those with high-deductible health plans. For 2025, individual contribution limits for HSAs are $4,150, while families can contribute $8,300. For individuals aged 55 or older, the HSA contribution limit allows an additional $1,000 catch-up per year. Will the SEC’s regulatory stance continue to shift as these major firms expand their digital asset offerings?