Fidelity settles for 500000 dollars, IRAs excluded from transfer terms

Fidelity Digital Assets has reached a 500000 dollar settlement with California, which includes a commitment to provide written notice if it ceases ordinary retail crypto transfers. Individual retirement accounts (IRAs) are excluded from the agreement's transfer obligations. Attorney General Rob Bonta announced the settlement on Oct. 16, addressing allegations of past withdrawal restrictions at Fidelity Digital Asset Services. Fidelity denies any wrongdoing and did not admit to legal violations. The settlement covers investigation-related fees and potential claims without establishing a customer compensation fund. From November 2022 to April 2025, California retail customers could buy and sell crypto but could not transfer it off the platform. Regulatory approval for transfers is expected in April 2025, with full access for all California customers by June 2025. The agreement allows existing transfers to external wallets, subject to applicable law, and mandates reasonable written notice for any future transfer cessation. Fidelity retains the right to restrict transfers to protect its platform or account holders. As of Oct. 18, Fidelity's state-availability page lists crypto deposits and withdrawals for ordinary accounts in California. The agreement also mentions plans for Fidelity Crypto IRA accounts in California, explicitly excluding these tax-advantaged accounts from transfer obligations. Currently, Fidelity's IRA FAQ indicates that the product is unavailable in California and Oregon, and where offered, crypto transfers and direct withdrawals from IRAs are not permitted.

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