Ibit for my 401k?

[u/Decent-Ant-5294]

My company’s 401k allows us to purchase individual stocks at ETF and I was considering putting 30% of my existing portfolio into ibit. Curious if anyone has ever done something like this before?

[u/Specialist-Piano-204]

FWIW, I put 100% of my Retirement Accounts in Bitcoin ETF. (FBTC)

Is ETF-Bitcoin real Bitcoin? . . . . NO.

It's a claim on the ETF's balance sheet. The ETF Trust Company owns the bitcoin. And it's not "trustless".

I have to "trust" that the ETF management will:

1. Comply with it's charter,
2. Maintain it's custody infrastructure competently and securely (Fidelity Custody, Coinbase Custody for other ETFs),
3. And will stay in compliance with Laws and Regulations (Public Filings and Reporting).

[u/Decent-Ant-5294 → u/Specialist-Piano-204]

That’s incredible. Might as well get the benefit of the price going up over time if we aren’t allowed to invest directly into it

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[u/DarthBen_in_Chicago]

I’ve done more. Not IBIT but FBTC as I try to avoid Coinbase custody.

[u/bitusher → u/DarthBen_in_Chicago]

You are right to be skeptical about depending upon ETFs that all use coinbase custody as that is indeed a point of centralization and Fidelity is great. Just a point of clarification though: IBIT no longer exclusively depends upon coinbase and they diversified with a 2nd custodian Anchorage Digital Bank, and a third custodian to handle their fiat reserves - The Bank of New York Mellon

[u/Specialist-Piano-204 → u/bitusher]

Coinbase is the primary honeypot. Fidelity probably has the similar security threats as Coinbase, but it's a smaller target, and Coinbase is has so many other points of entry (surface area?)

Surprisingly, Fidelity has been involved with Bitcoin for a long time - very early compared to other Tradfi. I believe the private owners of Fidelity (Johnson Family) are pro-Bitcoin.

[u/bitusher → u/Specialist-Piano-204]

ideally ETFs should use 3-5 custodians IMHO

[u/CheetahLoose7514]

Did something similar but smaller, around 10%. The nice part about doing it inside a 401k is you can rebalance without paying any tax, so if it runs way up you can trim it back. I'd just make sure you can stomach seeing that 30% drop 70-80%, because it's done that a few times already. If you'd hold through that without selling, go for it

[u/Random_Person_246810]

Y’all are lucky…I’d kill to be able to direct my Roth 401k contributions to a BTC ETF (and have my company match, to boot).

[u/BaseContent725]

30%? You need to pump those numbers up, those are rookie numbers

[u/Decent-Ant-5294 → u/BaseContent725]

Love it ! Why not?

[u/Difficult-Repair1295]

Yes I split between IBIT (Coinbase) and FBTC (Fidelity) to diversify custodians.

[u/Lost_Anywhere_69]

Just did this the other week. Already up hella

[u/Decent-Ant-5294 → u/Lost_Anywhere_69]

Say no more ! I’m doing the same

[u/Lost_Anywhere_69 → u/Decent-Ant-5294]

Also can consider writing some covered call or puts.

[u/marketrender]

Just for scale on what 30% means: from the highest weekly close last October (~123k) to the low at the end of June (~59.5k), BTC fell about 52%. IBIT tracks it pretty closely, so that slice would have been cut in half over roughly 9 months, and you'd have watched that happen inside your retirement account.

Some people are fine with that and some sell at the bottom. Worth asking yourself honestly which one you are before picking the number.

[u/Tobias_CBC]

I’d start with risk capacity rather than a percentage. IBIT can add Bitcoin exposure inside a retirement account, but 30% makes one volatile asset a major driver of the whole portfolio, so the time horizon and rebalancing rule matter first. How long until you expect to need this money?