Individual retirement accounts (IRAs) are an attractive savings solution for Americans, offering tax benefits as well as a range of investment choices, including cryptocurrency markets. Schwab provides multiple ways for accessing cryptocurrency markets – though spot trading of cryptocurrency markets is currently unavailable – including trusts, ETFs and Bitcoin futures contracts that all carry fees that could lower overall investment returns.
Cryptocurrencies have become an increasingly popular investment topic. Some consider them the currency of the future while others appreciate their blockchain technology underlying. Either way, cryptocurrency investments carry considerable risks – if you’re considering investing in this asset class it’s essential that you fully understand these risks and consider your investing goals before making your decision.
Schwab or any traditional custodian does not allow direct purchases of cryptocurrency directly within an IRA; however, many established custodians offer alternative means of exposure to the market – for instance coin trusts or futures can provide exposure while publicly traded companies that create much of the technology used by cryptocurrency can offer exposure as well.
These investments may also be less expensive than purchasing directly and don’t carry the same risk of value erosion as direct ownership; however, they don’t provide all of the same advantages of owning crypto assets themselves.
Retirement accounts do provide some options for holding crypto, though their selection will likely be more limited than at traditional brokerages. Most people who invest in cryptocurrency today do so outside their retirement accounts via custodial approaches or exchanges like Coinbase. There are a few key risks when investing in cryptocurrencies, including potential fraud and lack of recoveryability; conventional accounts typically allow investors to recover login credentials or lost funds; with crypto, however, once you lose the private key for your wallet it’s gone forever!
Schwab does not currently offer self-directed IRA accounts, which would enable investors to invest in crypto and other niche investments without incurring high commission costs from traditional brokerage accounts. You can however still utilize such accounts through Betterment or Fidelity which both offer low commission trading accounts.
Schwab provides global exposure to companies that could benefit from developments in the cryptocurrency space with its Schwab Cryptocurrency Exposure ETF, holding investments like exchanges, payment services, chip manufacturers and chip manufacturer that may contribute to growth of cryptocurrencies. Furthermore, it has a fund which tracks bitcoin’s performance specifically; you can learn more about all other cryptos at its dedicated page on their site.