Are you looking to add cryptocurrencies to your investment portfolio and searching for a reputable platform to help you navigate the market? Let’s explore what the newest app in the crypto trading space has to offer.
With a $1.05 trillion market capitalization and adoption by over 20% of Americans, cryptocurrency has become a significant asset class in the investment world. Recognizing strong consumer demand, M1 Finance—Investopedia’s 2022 #1 robo-advisor for sophisticated investors—recently incorporated crypto trading into its services.
Before diving into the details of M1 Finance and crypto trading, let’s first understand what cryptocurrency is.
## What Is Cryptocurrency?
Cryptocurrency is a digital payment system that operates without relying on banks to verify transactions. It functions as a peer-to-peer system that allows anyone to send and receive payments. The technology is decentralized, utilizing blockchain to secure and validate exchanges.
Read on to learn more about M1 Finance and cryptocurrency, how the platform works, what you can expect, its benefits, and its legitimacy.
—
## M1 Finance: A Brief Overview
Founded in 2015, M1 Finance is an American financial services company that combines automated investing with extensive portfolio personalization, complemented by borrowing and spending features. The platform offers robo-advisory services along with brokerage accounts, digital checking accounts, and lines of credit.
M1 Finance lets you choose from over 80 pre-built portfolios called “pies” or create your own custom investment strategy. This customizable portfolio approach is ideal for experienced investors who want to automate their master plan while aligning with their personal preferences, diversification goals, and risk tolerance.
### Account Types
M1 Finance supports various types of accounts to suit different portfolio needs, including:
– Joint taxable brokerage accounts
– Individual retirement accounts (IRAs)
– Custodial trust accounts (requiring additional paperwork)
Whether investing short-term or long-term, you can open a taxable brokerage account. The platform also offers a concierge service to assist with IRA rollovers, requiring the setup of a SEP IRA or trust accounts.
### Cost and Fees
M1 Finance stands out as a low-cost platform, charging no fees for investment management or trading. This means more of your money stays invested and working for you.
For more in-depth insights, you can read our full [M1 Finance review].
—
## M1 Finance and Crypto Investing
M1 Finance caters to modern, tech-savvy investors. Given the growing popularity of cryptocurrencies, its users have shown strong interest in trading digital assets seamlessly through the platform.
Trading crypto at M1 Finance is managed under M1 Digital LLC, an affiliate separate from M1 Finance LLC. It’s important to note that neither entity is involved in the execution or custody of cryptocurrencies, and crypto assets are not FDIC or SIPC insured—an important consideration as you assess risks.
### Understanding Cryptocurrency Volatility
Cryptocurrencies, like Bitcoin—the most well-known variant—are highly volatile. Prices fluctuate due to factors like supply and demand, investor sentiment, government regulations, and media coverage. Essentially, crypto’s stability is linked to broader economic and market forces.
While volatility might deter some investors, recent polls show increasing public acceptance of crypto assets.
### M1 Finance’s Crypto Approach
M1 Finance primarily focuses on long-term investing rather than day trading. Because crypto can suit both short-term and long-term strategies, M1 Finance emphasizes building portfolios that align with your risk tolerance and encourages closer management of crypto holdings.
Despite these risks, M1 Crypto introduces unique features aimed at making crypto trading customizable, easy, safe, and cost-effective. Adding crypto expands M1 Finance’s appeal and diversifies investment options for its user base.
—
## M1 Crypto Overview
Since September 2022, M1 Finance clients with funded brokerage accounts can access crypto accounts. New users can open a dedicated Crypto Account, whereas existing clients can add crypto investing to their existing accounts.
This setup allows investors to implement and automate diversified strategies across multiple asset classes—including crypto, stocks, and ETFs—within a single platform.
### Key Features of M1 Crypto
– **Automation:** Crypto accounts benefit from M1’s automation features, such as auto-investing, dynamic rebalancing, and scheduled investing.
– **Portfolio Building:** Clients can create crypto portfolios quickly by selecting from custom-built or pre-built M1 Expert Crypto Pies.
– **Secure Storage:** Assets are stored securely in separate custodial wallets powered by Apex Crypto, protected by military-grade 4096-bit encryption.
– **Dedicated Team:** M1 Finance has assembled a team of engineers, designers, and researchers specifically for this offering.
– **Trading Flexibility:** M1 Plus members enjoy on-demand trading 24/7 for up to 10 trades per calendar month. All users benefit from two-weekend trade windows, which are valuable given crypto’s volatility.
– **Cryptocurrency Selection:** Currently, ten cryptocurrencies are available for trading, including Bitcoin, Ethereum, Litecoin, Cardano, and Chainlink.
All these crypto features come alongside M1 Finance’s established benefits like commission-free investing.
—
## Funding Your M1 Finance Account
After setting up your account, you can fund it via a variety of sources once your bank is linked:
– IRA, Roth IRA, SEP IRA
– Checking account
– Savings account
Additionally, funding via credit or debit card is supported. Currently, PayPal is not an accepted funding method.
### Minimum Account Balance
– $100 minimum balance to open a taxable brokerage account.
– $500 minimum deposit required to open a retirement account.
– After the initial deposit, subsequent deposits can be as low as $10.
—
## M1 Finance Fees and Pricing
– No fees to open a basic account.
– Zero commissions on stock and ETF trades.
– No fees for portfolio management or executed trades.
– Minimum $100 balance for taxable accounts; $500 for retirement accounts.
– M1 Plus account ($125/year) offers additional benefits like no international debit card fees and an extra trading window.
– Interest rates on margin loans: up to 3.5% for basic accounts, 2% for Plus accounts.
– International debit card fees on basic accounts range from 0.8% to 1%.
—
## Pros and Cons of M1 Finance
### Pros
– No fees for buying or selling shares.
– Access to over 80 expert-investor portfolios to mimic.
– Comprehensive educational resources for beginners.
– Automated investing with no extra cost for standard accounts.
– Supports fractional shares, ETFs, and individual stocks.
### Cons
– $20 fee for inactive accounts.
– Limited customer support options.
—
## Is M1 Finance Ideal for First-Time Investors?
Yes. M1 Finance offers a blend of customization and automation that is beginner-friendly. Its zero-fee structure and simple, proprietary trading system automate the investment process, enabling newcomers to confidently start investing.
Automatic trade execution begins each morning at 9:30 AM Eastern Time. For an additional noon trading session, users can upgrade to M1 Plus.
—
## The Future of M1 Finance
M1 Finance continues to demonstrate strong growth and stability. With over $3 billion in assets under management and more than half a million clients, it solidifies its standing as a top choice for investors.
The platform’s blend of automation, deep customization, and no-fee investment make it attractive to a wide audience. New features such as **M1 Spend** (which offers 1% cash back on purchases) and **M1 Borrow** (offering lines of credit with competitive interest rates) enhance its competitive edge.
—
## Is M1 Finance Safe?
Yes. M1 Finance holds a solid reputation for safety, reliability, and trustworthiness. The platform is:
– Registered with the U.S. Securities and Exchange Commission (SEC)
– Licensed by the Financial Industry Regulatory Authority (FINRA)
– Accredited by the Better Business Bureau (BBB)
M1 Finance employs advanced security measures, including:
– Two-factor authentication (2FA)
– 4096-bit military-grade encryption for data protection
These protocols ensure the safety of your personal and financial information.
—
## Final Thoughts: Is M1 Finance Crypto Right for You?
Crypto investing should align with your overall investment goals and risk tolerance. If you believe in the long-term potential of cryptocurrencies, blockchain technology, and digital assets, M1 Crypto offers a compelling option to diversify your portfolio.
Being aware of crypto’s inherent risks—including volatility, potential for principal loss, and regulatory uncertainties—is essential to your success.
By integrating cryptocurrencies into its platform, M1 Finance demonstrates responsiveness to evolving investor needs and appeals to tech-savvy clients. Its seamless, integrated approach—combining custom Pies, automated portfolio management, and low costs—makes it a noteworthy choice for those interested in adding crypto to their investment strategy.
—
Ready to explore crypto investing with M1 Finance? Consider your goals, risk appetite, and the platform’s features to make an informed decision on adding cryptocurrencies to your portfolio.
https://radicalfire.com/m1-finance-and-crypto/
