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Millennials are leading the cryptocurrency revolution. And grandparents who want to win their hearts may find the way to do it is through their children’s digital wallets.
See: Teens Today Are Aware of Investing Because of Social MediaFind: What Is the Next Big Cryptocurrency To Explode in 2021?
A recent Wells Fargo survey showed that 45% of teens think they know more about crypto than their parents do — with 50% of parents agreeing that their teens’ knowledge of Bitcoin, specifically, exceeded their own. Combine crypto-savvy teens with that generation’s migration toward digital banks and the time is ripe for grandparents to shift their gift-giving strategy to promote investing, rather than spending.
In a study from financial services company Step, teens eschewed traditional banks, seeking options that were “built for teens” and “fee-free.” For many, that means digital savings accounts as well as investment apps.
Related: Teen Budgeting App Gets $100 Million Investment from Will Smith, Jared Leto
Here are a few good reasons why you should send crypto for your grandkid’s next birthday — or even an upcoming graduation celebration, back-to-school gift or other occasion that could warrant a check.
You’ll Emphasize the Importance of Investing
Even if you were late to the investment game, you’ll show your grandchild you support their efforts if you give them a gift that could increase in value over time. Whether the recipient already owns stock shares/crypto or is just cryptocurious, your gift can offer a jump-start or leg up.
More: Comparing Investments: Real Estate vs. Crypto vs. Gold
Your Teen Will Get More Value From Your Money
Cash is losing value quickly with inflation rates at a 13-year high. You wouldn’t want your gift to lose value before the recipient even has a chance to cash the check. If your teen is smart and savvy about their investment, they are almost certain to see reputable cryptos such as Ethereum and Bitcoin continue to rise in value.
When you’re tracking investments, it’s important to look at long-term trends instead of peaks and dips based on short-term market conditions. Since October 2013, Bitcoin has increased in value from $196.02 for one coin up to $34,213 per coin today.
Compare: Ethereum vs. Bitcoin: Which Crypto Is Better?
Crypto Is Convenient
Many teens don’t have bank accounts, which leaves it on their parents to cash the check and give them the funds. Empower teens with the added convenience of crypto delivered directly into their digital wallet.
Your Teen Can Convert the Crypto to Cash if Desired or Use It To Make a Purchase
Today, more companies than you might think accept Bitcoin as payment, including Etsy, Starbucks, and online electronics company Newegg. Many smaller companies and performing artists also accept crypto. You can also deposit Bitcoin into the payment platform PayPal and use it to make purchases that way.
Find Out: 10 Major Companies That Accept Bitcoin
Of course, your grandkid can always trade the crypto for cash to make a purchase anywhere — or shift their investment to their favorite stock.
How To Give Crypto as a Gift
Once you’ve recognized the benefits and incredible convenience of gifting crypto, you may wonder how to do it. Most crypto trading platforms make it easy to give as a gift. You may want to find out what platform the recipient uses if they already trade crypto or have a digital wallet. Coinbase is one of the most popular, but there are several others that are equally reliable and trustworthy.
Once you’ve set up an account, simply transfer the crypto via the app to the gift recipient. You will need their email address or their public Bitcoin address to make the transfer.
See: If You Invested $1,000 in These Cryptocurrencies a Year Ago, Here’s How Much You’d Have NowFind: Is Crypto Mainstream Now? Over 4/10 Investors Report Putting Money Into Cryptocurrency
If you like the idea of having a paper gift to present, you can obtain a “paper wallet” and print it. That wallet will contain a key or QR code for your grandchild to access their present and transfer it to their own account.
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Last updated: June 29, 2021
FAQs
You can purchase a cryptocurrency gift card from one of the handful of online retailers that offer them or take the more traditional route: buying cryptocurrency on a registered exchange and then sending it to the beneficiary's wallet address.
Can I buy Bitcoin for my grandchild? ›
Children cannot purchase cryptocurrency on their own, but they can do it with a parent or other adult's assistance. Parents can open a minor's custodial account. An account opened and managed for a minor by a person above 18 is known as a custodial account.
Can I gift crypto to my kids? ›
Crypto currency is an asset, just like any other and as such, is taxable. Gifting crypto currency to your children or anyone other than your spouse or civil partner, may result in you generating a capital gain on their disposal. There are also inheritance tax implications, should you die within 7 years of the transfer.
How to gift crypto to a minor? ›
Use a crypto gifting service
Options include the Robinhood Crypto Gifting Program or a service such as EarlyBird Crypto, which helps families gift crypto to children through a UGMA custodial account, a tax-advantaged account designed for giving cash or securities to minors.
Is it safe to send crypto to someone? ›
Therefore, senders must double-check and verify the correct wallet address, amount, and network before confirming the transaction to avoid any potential loss. Enter details carefully: For senders, it is crucial to verify the correct wallet address of the recipient.
What's the easiest way to send crypto? ›
Coinbase mobile app
You can select a contact, scan the recipient's QR code, or enter their email, phone number, crypto address, or ENS name. Select Continue. Enter the amount of crypto you'd like to send. You can toggle between the cash or crypto amounts.
How to buy crypto for your children? ›
Crypto Custodial Account
A custodial account is an adult-managed investment account that allows a parent or other guardian to open an account on behalf of a child. They give parents or families the ability to invest for their minor children, but the assets legally belong to the child.
Is there a Bitcoin gift card? ›
Is there a Bitcoin gift card? Yes, you may choose to send Bitcoin via Binance Gift Card.
What is the best crypto exchange for minors? ›
Some of the best P2P platforms for buying crypto under 18 are [LocalCryptos], [Paxful], and [LocalBitcoins]. These platforms do not require ID verification, but they may have some restrictions on the amount of crypto you can buy or sell.
Do I pay taxes on gifted crypto? ›
Crypto gifts are usually not taxable in the US for both the donor and the person receiving the gift. However, if you give someone over $17,000, you'd have more reporting requirements. If that's your case, you'd need to file a gift tax return since you have exceeded the annual gift tax exclusion amount.
How much crypto can you send without paying taxes? If you are sending crypto to another person in exchange for goods or services, you will be required to pay taxes on your disposal — regardless of the total volume.
Do you pay taxes on crypto before withdrawal? ›
The IRS works with contractors like Chainalysis to analyze publicly available blockchain transactions and crack down on tax fraud. There's no need to pay taxes on cryptocurrency unless you've disposed of it (ex. sold or traded it away) or earned crypto income (ex. staking & mining rewards).
Does a minor have to pay taxes on crypto? ›
The “kiddie tax” is reportable on an IRS Form 8615, Tax for Certain Children Who Have Unearned Income. If a parent fails to report a dependent's crypto capital gains in excess of $2,200, then the parent is omitting taxable income from his or her tax return.
Can I send crypto to someone else? ›
The basic way for a user to send BTC is to copy the recipient's address and then paste it into their wallet's 'send' field. Or, they can scan the recipient's QR code and automatically fill it in.
How much money do you put in a wallet as a gift? ›
Not sure how much money to include inside? Many cultures, such as certain communities in India or those who practice Judaism, believe that odd numbers are luckier than even numbers, meaning that slipping $101 into the wallet instead of $100 would be more favorable.
How do I send crypto to my friend? ›
Since crypto wallet addresses are long, they're often shown as a QR code that you can scan in your crypto app. Once you have the wallet address, you just need to open your crypto wallet, enter the wallet address, select how much crypto you want to send, and you're done.
How do you gift crypto to your significant other? ›
With the account being in your name, you are the beneficiary of any capital gains tax on the disposal of assets within that account. There is no Capital Gains Tax on the transfer of assets between spouses and civil partners, so you could transfer the asset to your wife prior to the disposal.
Can I send crypto to someone else's wallet? ›
Sending BTC to another wallet involves setting up a Bitcoin wallet and loading it with BTC. From there you have to initiate the transaction by filling in the details of how much you want to send and specifying the recipient's address.
Is receiving crypto as a gift taxable? ›
Crypto gifts are usually not taxable in the US for both the donor and the person receiving the gift. However, if you give someone over $17,000, you'd have more reporting requirements. If that's your case, you'd need to file a gift tax return since you have exceeded the annual gift tax exclusion amount.
