If you’re looking for a sign that interest in crypto has gone mainstream, it’s here: Fidelity — the longtime behemoth of retirement plans — now allows customers to invest directly in cryptocurrencies in a Roth IRA, traditional IRA or rollover IRA.
We’re not talking about dabbling in crypto-related ETFs (funds that invest in blockchain companies) or even spot Bitcoin ETFs.
The new Fidelity Crypto IRA, quietly unveiled in early April, provides retirement investors a tax-efficient direct entrée into the world of digital assets — wallets, cold storage and all.
Fidelity — or rather, its digital assets subsidiary — isn’t the only company hawking crypto IRAs (more on that below). But among the retirement-saving masses seeking additional portfolio diversification, it just became the most recognizable name in the space.
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Why do you need a special IRA to invest in crypto?
For those hunting for the “buy Bitcoin” button in their current Fidelity IRA, let me save you the trouble: It’s not there.
The Fidelity Crypto IRA is technically a self-directed IRA (SDIRA) with account administrative duties handled by the company’s subsidiary, Fidelity Digital Assets. Self-directed IRAs come in the usual IRA flavors (Roth, traditional, SEP), but they are different in one key way: SDIRAs allow account holders to invest in a wider array of assets, including commodities, precious metals, private stock, crowdfunded assets (like loans and real estate) and cryptocurrency.
Standard IRA custodians (the broker or bank that manages the account) must act as fiduciaries and can only put regulated, publicly available fare (stocks, funds, bonds, REITs, etc.) on the menu of investment options.
SDIRA custodians operate under different, more hands-off regulatory and oversight rules, which puts the onus for determining the legitimacy and appropriateness of available assets on the individual investor.
IRA contribution and taxation rules set by the IRS apply to both standard IRAs and self-directed IRAs. In other words, if you are eligible to contribute $7,000 to a traditional IRA in 2025, that’s the most you can save in a Fidelity Crypto IRA, too.
Some SDIRA companies focus solely on a narrow market, such as gold IRAs that invest in the physical asset or crypto IRAs, like Fidelity’s.
| Crypto IRA pros | Crypto IRA cons |
|---|---|
| Tax-deferred growth (and potential upfront deduction) in a traditional IRA; tax-free withdrawals in a Roth | Annual IRA contribution limit and IRS eligibility/deductibility rules limit allocation options |
| Provides portfolio diversification beyond traditional retirement savings assets | Exposes long-term portfolio to a highly volatile asset; risk of over-concentration |
| Administrative tasks like setting up and managing a wallet are offloaded | Potentially high setup, custodial, transaction, processing and management fees |
| Crypto is not insured by the FDIC or SIPC |
Tax-friendly crypto investing, Fidelity style
Fidelity Crypto IRAs share much of the same DNA as the broker’s standard IRA offerings: No investment minimums, no junky account fees (though there are expenses), and streamlined account setup and management.
If there were such a thing as taking a measured approach to investing in crypto in a retirement account, it would probably look a lot like what Fidelity is offering. Here’s a rundown of account basics:
What can you buy in a Fidelity Crypto IRA? Customers are currently limited to just three of the more popular cryptocurrencies: Bitcoin, Ethereum and Litecoin (No memecoins here!)
How much does it cost? Like the broker’s regular individual retirement accounts, its crypto IRAs have no minimums or ongoing account fees. But there are costs that will whittle away at your retirement account returns: Customers pay a spread of 1 percent on the execution price of crypto buy and sell transactions.
Do I need to set up a digital wallet? Nope. Fidelity does that for you. Digital currencies are held in “cold storage” (digital wallets not connected to the internet) with Fidelity Digital Assets serving as the custodian.
Which types of IRAs are offered? Currently, the lineup includes three flavors: Roth, traditional and rollover (which simply refers to a Roth or traditional IRA set up to receive transfers from a similar type of retirement account from an employer or another brokerage).
Can anyone open a crypto IRA? With a non-crypto IRA, anyone with earned income is eligible to set up an account. Fidelity’s crypto IRA has a few extra requirements: You must be a U.S. citizen age 18 or older and reside in a state that allows it (basically any state except California or Oregon). IRS rules around Roth and traditional IRA eligibility, contribution limits and deductibility apply equally to crypto and non-crypto IRAs.
How do you fund a crypto IRA? Customers are required to set up two IRAs — a Roth, traditional or rollover IRA to serve as a funding account and a Fidelity Crypto IRA of the same type (Roth or traditional) to receive transferred contributions and facilitate trades. If you don’t have an existing Fidelity IRA to serve as the feeder account, Fidelity will open one for you at the same time you set up your crypto IRA.
You’re allowed to split your IRA contribution between accounts — e.g., between a traditional IRA and a crypto IRA — as long as the total does not exceed the annual maximum allowed by the IRS.
Fidelity Crypto IRA vs. the competition at a glance
| Fidelity Crypto IRA | Alto CryptoIRA | Bitcoin IRA | |
|---|---|---|---|
| IRA types | Traditional, Roth | Traditional, Roth and SEP | Traditional, Roth, SEP, SIMPLE, Solo 401(k) |
| Number of cryptocurrencies | Bitcoin, Ethereum, Litecoin | 250+ cryptocurrencies | 75+ cryptocurrencies |
| Minimums | $0 to open account; $1 minimum to buy crypto | $10 minimum investment | $3,000 minimum initial investment and $10 trade minimum |
| Trading fees (on buys and sells) | 1 percent | 1 percent | 2 percent |
| Account fees | $0 | $37.50 to $100 per quarter, depending on account balance | 1.99 percent setup and deposit fee; 0.08 percent monthly maintenance and security fee |
Does crypto have a place in your IRA?
Is there a place for crypto in individual investors’ portfolios? According to Bankrate’s First-Quarter 2025 Market Mavens Survey, the majority of experts say no, unless you understand the long list of risks, which includes volatility, low liquidity, high costs and the potential for fraud.
Keep in mind that you don’t need to buy digital coins directly to gain exposure to crypto in your retirement portfolio — or even set up a separate self-directed IRA.
In 2024, the SEC gave brokers approval to offer spot Bitcoin ETFs and spot Ethereum ETFs to brokerage clients in both tax-advantaged accounts (IRAs) and taxable accounts. In fact, Fidelity offers two crypto ETFs: The Fidelity Wise Origin Bitcoin Fund (FBTC) and the Fidelity Ethereum ETF (FETH), both with low expense ratios.
But if you are crypto-curious and want to leverage the tax benefits of holding it in IRA, consider discussing the appropriate level of exposure with a financial advisor who can help you find the right risk-reward balance within the context of your overall financial situation.
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