Yes, you can buy Bitcoin on Fidelity, but only through specific accounts and with restrictions that depend on the account type you hold

Fidelity offers Bitcoin trading through two main routes: a standalone cryptocurrency trading platform called Fidelity Crypto, and Bitcoin exposure within certain retirement and brokerage accounts. The path available to you depends on whether you want to hold Bitcoin directly, own it through a fund, or trade it in a retirement account. Not all Fidelity account types support cryptocurrency purchases, and the ones that do have different rules about how much you can buy and when you can sell.

The most straightforward way is Fidelity Crypto, which is a separate platform where you can buy, sell, and hold Bitcoin directly. You can also buy Bitcoin indirectly through a Bitcoin mutual fund or exchange-traded fund (ETF) in a regular brokerage account. If you have a retirement account like an IRA or 401(k) at Fidelity, Bitcoin options are more limited and depend on your plan's specific rules.

Key Takeaways

  • Fidelity Crypto is a separate platform where you can buy and hold Bitcoin directly, though you must open an account there in addition to any existing Fidelity brokerage account.
  • You can gain Bitcoin exposure in a regular brokerage account by buying Bitcoin ETFs or mutual funds without needing a separate cryptocurrency platform.
  • Retirement accounts like IRAs and 401(k)s at Fidelity have limited or no direct Bitcoin purchasing options, though some plans may offer self-directed alternatives.
  • Fidelity Crypto requires identity verification and has minimum account funding requirements that vary by transaction type.

Buying Bitcoin directly through Fidelity Crypto

Fidelity Crypto is a standalone platform separate from your main Fidelity brokerage account. To use it, you must create a new account on the Fidelity Crypto platform even if you already have a Fidelity brokerage account. The platform allows you to buy Bitcoin with U.S. dollars, hold it in a digital wallet, and sell it whenever you choose.

To start, you will need to complete identity verification, which involves providing your Social Security number, date of birth, and address. Fidelity Crypto also requires you to link a bank account or debit card for funding. Once your account is set up and funded, you can place orders to buy Bitcoin at the current market price. Fidelity Crypto operates during extended hours, so you can trade Bitcoin outside standard stock market hours.

Fidelity Crypto charges a transaction fee for each buy or sell order. The fee structure varies depending on whether you are making a market order (buying at the current price) or a limit order (setting your own price). You should review the current fee schedule on the Fidelity Crypto platform before placing your first trade, as fees can change.

Buying Bitcoin through ETFs and mutual funds in a brokerage account

If you do not want to use Fidelity Crypto, you can gain Bitcoin exposure by purchasing a Bitcoin ETF or mutual fund through your regular Fidelity brokerage account. This approach means you own shares of a fund that holds Bitcoin, rather than owning Bitcoin directly. The fund manager handles the actual Bitcoin storage and security.

Fidelity offers several Bitcoin-related funds, including spot Bitcoin ETFs that track the price of Bitcoin closely. You can buy these funds the same way you would buy any stock or mutual fund through your brokerage account — by searching for the fund ticker, entering the number of shares you want, and placing an order. There are no separate fees beyond the fund's expense ratio, which is the annual cost of owning the fund expressed as a percentage of your investment.

This method is simpler than using Fidelity Crypto because you do not need a separate account or cryptocurrency wallet. However, you are paying the fund's ongoing expenses, and you do not own Bitcoin directly — you own a claim on the fund's Bitcoin holdings.

Bitcoin in retirement accounts at Fidelity

Most standard Fidelity IRAs and 401(k)s do not allow direct Bitcoin purchases. Traditional IRAs, Roth IRAs, and employer-sponsored 401(k)s through Fidelity are designed to hold stocks, bonds, mutual funds, and ETFs — not cryptocurrencies. However, you may be able to own Bitcoin indirectly by purchasing a Bitcoin ETF within these accounts if the plan allows it.

Some Fidelity retirement plans offer a self-directed brokerage option, which gives you access to a wider range of investments. If your plan includes this feature, you might be able to purchase Bitcoin ETFs within that self-directed window. Check your plan documents or contact Fidelity directly to confirm whether your specific retirement account supports Bitcoin ETF purchases.

If you have a self-directed IRA outside of Fidelity, you may have more flexibility to hold Bitcoin directly, but that would require moving your account to a provider that specializes in cryptocurrency IRAs. Fidelity itself does not offer direct Bitcoin holdings within retirement accounts at this time.

Minimum amounts and account requirements

Fidelity Crypto does not have a stated minimum account balance, but individual transactions may have minimums depending on the order type. Market orders and limit orders may have different minimum purchase amounts. You should check the Fidelity Crypto platform for current minimums before funding your account.

For Bitcoin ETFs purchased through a regular brokerage account, the minimum is typically the price of one share of the fund, which varies by fund. Some Bitcoin ETFs trade for under $100 per share, while others may be higher. You can buy fractional shares of many ETFs at Fidelity, which means you can invest any dollar amount rather than waiting to afford a full share.

All Fidelity accounts require identity verification before you can trade. This is a legal requirement, not a Fidelity policy, and applies to every brokerage and cryptocurrency platform in the United States.

Taxes and reporting when you sell Bitcoin

When you sell Bitcoin for a profit, you owe capital gains tax on the difference between what you paid and what you sold it for. Fidelity will send you a tax form (Form 8949) at the end of the year if you sold Bitcoin through Fidelity Crypto. You must report this on your tax return.

The tax rate depends on how long you held the Bitcoin. If you held it for less than one year, it is taxed as short-term capital gains at your ordinary income tax rate. If you held it for more than one year, it is taxed as long-term capital gains at a lower rate (0%, 15%, or 20%, depending on your income).

Bitcoin held in a retirement account like an IRA or 401(k) is not taxed when you sell it, as long as you keep the proceeds in the retirement account. You only pay taxes when you withdraw money from the account, and the tax treatment depends on the account type.

Security and custody of your Bitcoin

When you buy Bitcoin through Fidelity Crypto, Fidelity holds the Bitcoin in custody for you. This means Fidelity is responsible for storing it securely and protecting it from theft or loss. Fidelity uses cold storage (offline vaults) for the majority of customer Bitcoin holdings, which is considered more find than online storage.

Fidelity Crypto accounts are not covered by the Securities Investor Protection Corporation (SIPC), which protects traditional brokerage accounts. However, Fidelity maintains insurance on cryptocurrency holdings. You should review Fidelity's insurance and security policies on the Fidelity Crypto website to understand the exact coverage.

If you purchase a Bitcoin ETF through your regular brokerage account, your shares are held in custody by Fidelity and are covered by SIPC protection up to $500,000 per account. The ETF itself holds the actual Bitcoin, and the ETF provider is responsible for its security.

Frequently Asked Questions

Do I need a separate Fidelity Crypto account if I already have a Fidelity brokerage account?

Yes. Fidelity Crypto is a separate platform with its own login and account. Your existing Fidelity brokerage account does not automatically give you access to Fidelity Crypto. You must create a new account on the Fidelity Crypto platform, though the sign-up process is faster if you are already a Fidelity customer because some of your information is already on file.

Can I transfer Bitcoin from Fidelity Crypto to an external wallet?

Yes, Fidelity Crypto allows you to withdraw Bitcoin to an external wallet that you control. You will need the wallet address and should be aware that Fidelity may charge a withdrawal fee. Withdrawals typically process within one to two business days, though blockchain confirmation times may vary.

What is the difference between owning a Bitcoin ETF and owning Bitcoin directly through Fidelity Crypto?

With a Bitcoin ETF, you own shares of a fund that holds Bitcoin, and the fund manager is responsible for security and custody. With Fidelity Crypto, you own Bitcoin directly and Fidelity holds it in custody for you. ETFs are simpler and do not require a separate account, but you pay ongoing fund expenses. Direct ownership gives you more control but requires managing a separate cryptocurrency account.

Is Bitcoin purchased through Fidelity insured?

Bitcoin held through Fidelity Crypto is insured by Fidelity but is not covered by SIPC. Bitcoin ETF shares held in a regular brokerage account are covered by SIPC up to $500,000. You should review Fidelity's specific insurance terms on their website, as coverage details and limits may change.

Can I buy Bitcoin in my Fidelity 401(k)?

Most Fidelity 401(k) plans do not allow direct Bitcoin purchases. However, some plans offer a self-directed brokerage option that may allow you to purchase Bitcoin ETFs. Check your plan documents or contact Fidelity to confirm what investments are available in your specific plan.