Fidelity and Grayscale Introduce Fresh Crypto Investment Options for US Investors

In a sign of the growing integration of digital assets into traditional financial products, two major players in the investment space have announced new cryptocurrency-focused offerings aimed at long-term investors. Fidelity Investments has introduced nearly fee-free retirement accounts that allow Americans to invest directly in Bitcoin, Ether, and Litecoin. Meanwhile, Grayscale Investments has launched two outcome-oriented Bitcoin exchange-traded funds (ETFs) designed to generate income by leveraging Bitcoin’s price volatility. 

Fidelity Opens the Door for Crypto Retirement Accounts, Offering Bitcoin, Ether, and Litecoin Exposure

In a move poised to reshape the American retirement landscape, Fidelity Investments, one of the largest financial services companies in the world with over $5.9 trillion in assets under management, has unveiled a new suite of retirement accounts designed to allow US investors to gain direct exposure to cryptocurrencies — all with minimal fees.

The new offering includes three distinct retirement vehicles: a tax-deferred traditional Individual Retirement Account (IRA), as well as two types of Roth IRAs, including a rollover option. These accounts will give investors the ability to buy and sell Bitcoin (BTC), Ether (ETH), and Litecoin (LTC), three of the most prominent cryptocurrencies by market capitalization.

Fidelity’s crypto IRAs are being offered through its Fidelity Digital Assets subsidiary, which until now has primarily catered to institutional clients, such as hedge funds and family offices. The expansion into retail retirement accounts signals yet another step toward mainstream crypto adoption in the US, providing American savers and investors with a regulated, well-established channel to diversify their retirement portfolios with digital assets.

Nearly Fee-Free Access to Crypto in Retirement Accounts

Fidelity’s new crypto IRAs stand out for their low-cost structure. The company has announced zero account opening or maintenance fees for these retirement vehicles. Instead, Fidelity will generate revenue via a 1% spread fee on the execution price of buy and sell transactions — a model that is considerably more attractive than the fees charged by many crypto-focused IRA providers in the market today.

This offering is designed to make cryptocurrency investing accessible to the average American worker, many of whom have been wary of complex and expensive platforms in the past. The move reflects growing demand for digital asset exposure among long-term investors, particularly those looking to hedge against inflation, diversify their retirement savings, or participate in the future of decentralized finance.

Fidelity's decision to broaden access to crypto investments through IRAs is part of a wider trend in the United States, where regulatory clarity and institutional interest are rapidly transforming the crypto landscape. In recent months, several notable events have signaled that crypto adoption is no longer on the fringe:

• Multiple US companies, including stablecoin issuer Circle, have filed for initial public offerings (IPOs), aiming to bring their digital asset operations into public markets.

• A number of US corporations have adopted strategic Bitcoin reserves as part of their treasury strategies.

• Lawmakers have introduced new legislation to increase crypto accessibility within retirement accounts.

Most notably, Alabama Senator Tommy Tuberville recently announced the reintroduction of a bill that would allow Americans to include cryptocurrency in their 401(k) plans. The legislation aims to scale back regulatory constraints imposed by the Department of Labor, further opening the door for Americans to integrate digital assets into their retirement strategies.

Addressing Security Concerns with Cold Storage

Security has long been a sticking point for crypto-curious investors, especially those considering long-term holdings in retirement accounts. To address this, Fidelity has emphasized that it will store the majority of the cryptocurrencies held in these IRAs in cold storage — meaning the digital assets will be stored offline in secure wallets, significantly reducing the risk of hacks and cyber attacks.

This institutional-grade security approach is expected to boost confidence among investors who may have previously been concerned about the safety of crypto holdings in retirement portfolios.

While Fidelity’s offering is a groundbreaking move by a traditional financial giant, it is not the first method available for US investors to gain crypto exposure within tax-advantaged accounts.

Since early 2024, Bitcoin and Ether ETFs have allowed investors to gain exposure to these leading cryptocurrencies indirectly. These ETFs are typically accessible through existing retirement brokerage accounts, making them an easy option for many Americans.

Additionally, self-directed Bitcoin IRAs and platforms like BitIRA have offered digital-asset-specific retirement accounts, enabling investors to purchase a broader range of cryptocurrencies — including altcoins like Litecoin — while benefiting from tax advantages.

However, Fidelity’s entry into the space brings the weight and trust of a household-name institution, potentially making crypto retirement investing more palatable to the average investor.

A Growing Demand for Crypto in Retirement Portfolios

The growing interest in cryptocurrency inclusion within retirement accounts is driven by a generational shift in investment preferences. A recent Gallup poll revealed that 47% of millennials and Gen Z investors view cryptocurrency as a viable long-term investment, compared to just 16% of Baby Boomers.

Fidelity’s move is likely to accelerate this trend, as more Americans recognize the potential of digital assets to diversify portfolios and generate long-term returns.

Moreover, with US lawmakers actively discussing legislative measures to loosen restrictions around crypto in retirement plans, and the increased availability of crypto ETFs and self-directed IRA solutions, the momentum toward wider crypto retirement adoption is clear.

Grayscale Launches Two Outcome-Oriented Bitcoin ETFs to Harness Crypto Volatility

In related news, Grayscale Investments, the world's leading cryptocurrency asset manager, has expanded its suite of digital asset investment products with the launch of two new Bitcoin-focused exchange-traded funds (ETFs). The new offerings, unveiled on April 2, are the Grayscale Bitcoin Covered Call ETF (BTCC) and the Grayscale Bitcoin Premium Income ETF (BPI) — both designed to capitalize on Bitcoin’s notorious volatility while offering investors alternative income streams.

This bold step by Grayscale marks a significant evolution in how crypto investors can approach income-generating strategies within the digital asset space. Unlike traditional Bitcoin ETFs that simply mirror spot price movements, these ”outcome-oriented” ETFs employ sophisticated options-based strategies to provide both income generation and exposure to Bitcoin’s growth potential.

Complex Strategies to Tap Into Bitcoin’s Volatility

The first of the two new products, the Grayscale Bitcoin Covered Call ETF (BTCC), aims to maximize potential income through a systematic covered call strategy. The fund will routinely write call options near Bitcoin’s spot price, a method that allows it to collect option premiums while giving up some upside potential. This strategy is tailored to investors seeking to supplement their Bitcoin exposure with a structured income stream without the need to actively manage complex options themselves.

The second product, the Grayscale Bitcoin Premium Income ETF (BPI), takes a slightly different approach. It focuses on writing out-of-the-money call options on a variety of Bitcoin ETFs, including Grayscale’s flagship products like the Grayscale Bitcoin Trust (GBTC) and the Grayscale Bitcoin Mini Trust (BTC). This approach aims to balance income generation with the potential for price appreciation, offering investors the chance to participate in much of Bitcoin's upside while benefiting from periodic income distributions.

The launch of these two ETFs comes at a time when investors are increasingly looking for diversified ways to earn yield on digital assets without relying solely on price appreciation. Bitcoin’s high volatility, often viewed as a risk factor, is being reimagined by Grayscale as an income-generating opportunity.

By using sophisticated options strategies, these ETFs promise to deliver a systematic, rules-based approach to options management, with monthly income distributions — an attractive proposition for both institutional and retail investors who are looking to generate yield in a market known more for speculation than steady returns.

Grayscale also noted that these outcome-oriented ETFs can serve as a complement to direct Bitcoin ownership or to other crypto-exposure products, allowing investors to create diversified strategies in their crypto portfolios.

The unveiling of BTCC and BPI is the latest in a series of product launches and regulatory filings by Grayscale Investments as it aggressively expands its footprint in the crypto ETF space.

Earlier this week, Grayscale filed for the creation of a broad-based cryptocurrency ETF that includes a basket of leading digital assets such as Bitcoin (BTC), Ether (ETH), XRP, Solana (SOL), and Cardano (ADA). This diversified ETF aims to offer investors exposure to multiple crypto assets within a single product, further cementing Grayscale’s position as a leading provider of digital asset investment vehicles.

In addition, Grayscale has submitted a filing through Nasdaq to the US Securities and Exchange Commission (SEC) for a spot Avalanche (AVAX) ETF, and is currently awaiting approval for several other high-profile products, including an XRP spot ETF, a Cardano spot ETF, and the conversion of its Litecoin Trust into an ETF.

Some of the crypto products listing on Grayscale’s website (Source: Grayscale)

With these new filings and product launches, Grayscale’s total product lineup has grown to 28 crypto-focused investment vehicles, comprising 25 single-asset derivatives and three diversified ETFs.

The Next Phase of Crypto Investment Products

Grayscale’s aggressive ETF expansion strategy reflects the evolving nature of the crypto investment market. While early-stage Bitcoin ETFs focused primarily on price-tracking exposure, the market is now shifting toward structured, outcome-oriented strategies that mirror those found in traditional equities markets.

By introducing income-focused derivatives tied to Bitcoin’s volatility, Grayscale is addressing the growing demand among investors for non-correlated income sources and diversified ways to profit from the cryptocurrency market’s unique characteristics.

This trend also aligns with broader institutional interest in Bitcoin and crypto markets, driven by increased regulatory clarity and the growing acceptance of cryptocurrencies as a legitimate asset class.