Coinbase is teaming up with 401 (k) provider ForUsAll to bring cryptocurrency options to retirement accounts.
Major cryptocurrency exchange Coinbase has a new partnership with ForUsAll that will allow for crypto investments within their retirement accounts. Workers will be able to invest up to 5% of their 401 (k) payments in a number of different cryptocurrencies if their employer uses AllForUs’ plan.
Clients who possess a ForUsAll retirement plan will be given the ability to directly invest using cryptos. Meanwhile, Coinbase Institutional trading platform handles the actual trading and custody of funds and allows access to around 50 cryptos.
The Wall Street Journal reports that ForUsAll has 400 employers signed up with plans totaling $1.7 billion in retirement assets. While that sounds like a lot of money, in the world of retirement plans, it is just a drop in the bucket of a $22 trillion market. With the pivot toward digital assets, ForUsAll is trying to grab a bigger piece of that pie.
The major players in the 401 (k) game such as Charles Schwab Corp. and Fidelity do not offer the ability to invest buy or sell cryptos in either taxable accounts or IRAs. While some Grayscale products are Bitcoin adjacent, but are not a direct investment. Fidelity has made steps toward offering crypto exchange-traded funds by filing with the Securities and Exchange Commission.
Experts recommend adding crypto to your 401(k) planning
As more and more sectors of finance begin to adopt cryptocurrencies, planning for retirement becomes less straightforward than it has traditionally been. Many experts agree that investors should diversify some of their retirement assets by converting them to digital currency. One of the more vocal proponents of this recently has been Anthony Scaramucci.
The former White House Chief of Communications believes that cryptos are an important and often overlooked part of one’s financial future. “If we’re right about bitcoin and I was your financial advisor, I would tell you that over the next 100 years, this is the technology that people are going to use for a large swath of commerce on the planet,” said Scaramucci in a recent interview with 401K Specialist Magazine.
Scaramucci was quick to clarify that due to the volatile nature of digital currencies, investments should be made in “bite-size, digestible chunks.”
CIO of ForUsAll David Ramirez agrees in allocating a reasonable amount of one’s portfolio for cryptocurrency investment. “Alternative investments, including small allocations to cryptocurrency, can help improve portfolio diversification and expected returns,” Ramirez stated.
ForUsAll has yet to announce how many of the firm’s 400 employer clients have joined the crypto plan.