Newport Beach, Calif.-based asset manager Digital Asset Investment Management (DAiM), which bills itself as the first licensed Registered Investment Advisor for Bitcoin and Digital Assets, has launched what it is calling “the first ERISA compliant employer-sponsored 401k plans with Bitcoin.”
It should be noted that San Francisco-based Bitwage launched what it touted as “the world’s first Bitcoin 401k plan” in May 2020.
According to a Nov. 19 announcement, DAiM will serve as the 3(38) advisor and fiduciary and is responsible for selecting, managing, monitoring, and benchmarking the investment offerings, helping companies “create a 401k plan that offers several recommended model portfolios of varying risk to traditional assets and allocation of up to 10% to Bitcoin.”
“From the moment we were approved by the State of California in June 2018, we’ve seen incredible inbound demand from individuals eager to invest Bitcoin in 401ks,” said Adam Pokornicky, COO of DAiM.
Pokornicky told Cointelegraph, a website covering fintech, blockchain and Bitcoin, that there is “booming” demand for retirement investments in Bitcoin, adding that the most demand is from individuals between the ages of 28-45.
“Conventional 401k plans are restrictive and often lack investment options, causing participants to not only be frustrated but have poor risk-adjusted returns that barely keep up with the rate of inflation. This is a bad deal for savers given the current environment. We believe Bitcoin has demonstrated it has a place in the modern portfolio and individuals should have an opportunity to ‘Get Off Zero’ and invest directly through their retirement account,” Pokornicky added.
“We executed the very first employer-sponsored 401k plan in October 2019 and have been diligently testing for the past year, now allowing us to launch scalable 401k plans that provide recordkeeping and administrative services,” he said. “We’re proud to be a leader in regulated Investment Management services for Bitcoin and are excited to lend our fiduciary capacity to enable access to Bitcoin in 401k plans in this way.”
Bitcoin will be held securely in Institutional Cold Storage Custody with Gemini Trust, DAiM’s partner for its primary Investment Advisory services. Should the employee leave their company, their Bitcoin will be able to transfer with them. And should an individual want to allocate more to Bitcoin, they can schedule an investment consultation with DAiM.
The announcement said DAiM is able to work with companies of any size, to either switch plans from their current provider or by implementing a first-time employer-sponsored 401k plan with key tax credits.
According to DAiM, companies interested in offering their employer-sponsored 401k plan with Bitcoin in 2021 need to put the plan in place by mid-December of this year. Companies interested in exploring this service can apply https://www.daim.io/Bitcoin401k or by emailing [email protected].