Fidelity Investments, a multinational financial giant, is exploring plans to allow investors to hodl bitcoin (EXANTE: Bitcoin) in their 401(k)s, the Wall Street Journal reports.
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According to the report, Fidelity plans to offer the new service to 23,000 of its clients later this year. Dave Gray, Head of Workplace Retirement Offerings and Platforms at Fidelity, says there is a need for a "diverse set of products and investment solutions for our investors."
"We fully expect that cryptocurrency is going to shape the way future generations think about investing for the near term and long term," he added.
Under the plan, the Boston-based company plans to allow investors to allocate up to 20% of their nest eggs to bitcoin. However, that threshold could be lowered by employees depending on their attitude to the cryptocurrency. Initially, Fidelity plans to allow only bitcoin as an addition to 401(k)s, but Gray added that other cryptocurrencies are also to be made available at some time in the future.
"We have seen growing and organic interest from clients," Gray said, noting that "a number are in the evaluation process."
The US Labor Department pointed out however that employers planning to add support for crypto should expect questions about "how they can square their actions with their duties of prudence and loyalty" under US pension law. In May 2020, Gemini in cooperation with the Bitwage payroll service introduced the possibility of generating pension savings under the 401(k) model with a certain percentage in bitcoin.
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