Can I invest in cryptocurrency through my daughter's Junior ISA?

Q: Can I invest in cryptocurrency through my daughter's Junior ISA?

A: We’ve had a number of questions to Ask Fidelity enquiring about investing in cryptocurrency recently. Yours is the latest.

That’s understandable given the remarkable rise in crypto asset prices in recent years. But 2025 has been a reminder of how volatile crypto can be: in our 2025 investment round up, bitcoin was back at the bottom of the performance table.

In short, the answer is that you have been able to get crypto exposure through certain ETFs with a Junior ISA, but you haven’t been able to invest in assets that mirror cryptocurrency prices. This has now changed.

From 8 October, the regulator has allowed individual investors to put ISA money in   investment vehicles that invest into a cryptocurrency such as bitcoin. Cryptocurrency products which are bought and sold on the stock market like ETFs (exchange traded funds) have been allowed by the City regulator to be sold to institutions for some time. What changed was that individuals can now also invest and hold them in an ISA or pension.

This is in a type of product called 'exchange traded notes' which are 100% backed by the cryptocurrency itself, making them a faithful way to deliver bitcoin returns to investors.

For Fidelity’s part, we hope to make cryptocurrency ETNs, or cETNs, available on the Personal Investing platform. We are looking at the extra safeguards that are needed.

There are also additional considerations that the industry is navigating. For instance, crypto ETNs are now eligible for inclusion in stocks and shares ISAs but from 6 April 2026 they will be reclassified as qualifying investments only within Innovative Finance ISAs, which are less commonly offered by financial providers and not offered today by Fidelity.

They are also not allowed as Innovative Junior ISAs, further complicating the picture. We will alert customers to news on our offering  in our Pulse emails.

Indirect investing options

Crypto assets are volatile; their future potential as an asset always spark heated debate. Careful consideration is needed to include these assets in your daughter’s Junior ISA, even as a small part of the portfolio.

However, there are several other ways to own crypto more indirectly, or at least to have exposure to the cryptocurrency arena.

One option is to buy shares in a company whose value is linked to that of cryptocurrency. An example is the American business Strategy, which was previously known as MicroStrategy. It is described as ‘a provider of enterprise-ready analytics, mobile, and security software platforms’. But it also uses the money generated by the other parts of its business, as well as funds raised by selling shares and by borrowing, to buy bitcoin.

Another large crypto-related company whose shares you can hold in an ISA is Coinbase, the cryptocurrency broker. These have been highly volatile stocks.

Another approach is to invest in the crypto sector more broadly through diversified funds that hold a range of crypto related businesses. This can reduce single stock risk, although it does not remove the sector’s volatility.

One such fund is the iShares Blockchain Technology UCITS ETF, which is an exchange-traded fund (ETF) bought and sold on the stock market. You can see the portfolio top 10 here. It includes Coinbase but also has exposure to other nuts and bolts parts of the industry. Investors also end up with exposure to AI. Nvidia makes the top 10.

Another recent addition to the Fidelity Personal Investing platform is the VanEck Crypto and Blockchain Innovators ETF. This ETF invests in a concentrated portfolio of around 20 crypto-related companies and, unlike the iShares Blockchain Technology ETF, holds Strategy as one of its largest holdings.

Remember that cryptocurrencies are a relatively new invention and have yet to be used as money on an appreciable scale; instead, they have been used largely as a means of financial speculation. Unlike many conventional investments, they also generate no income and have had periods of high volatility. Regulators have warned that buyers of crypto should be prepared for the entire loss of their investment. It has said no more than 10% of complex assets, such as cryptocurrencies, should be held in an individual investor’s portfolio.

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Important information - investors should note that the views expressed may no longer be current and may have already been acted upon. Eligibility to invest in a Junior ISA and tax treatment depends on personal circumstances and all tax rules may change in the future. Withdrawals from a Junior ISA will not be possible until the child reaches age 18. Overseas investments will be affected by movements in currency exchange rates. Reference to specific securities should not be construed as a recommendation to buy or sell these securities and is included for the purposes of illustration only. This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to one of Fidelity’s advisers or an authorised financial adviser of your choice.