Should I Buy Bitcoin for My Child?

You've bought some Bitcoin for yourself. Maybe a lot, maybe a little. Now you're thinking: should I buy some for my kid? The honest answer is: it depends. Let's walk through it.

The case for buying Bitcoin for your child

Bitcoin has a fixed supply of 21 million. If demand grows over the next 15-20 years (the time horizon most parents are thinking about), each bitcoin becomes more scarce relative to the number of people who want it. That's the core bet.

A small, regular purchase ($10-25/month) over 18 years adds up. You're not trying to time the market. You're giving your kid a head start on owning an asset that can't be inflated away.

The case against (or at least, the risks)

Bitcoin's price has dropped 70-80% multiple times. In 2022, it fell from $69,000 to $16,000. If you need the money in 5 years for college, that volatility is a real problem.

Bitcoin isn't insured like a bank account (FDIC covers up to $250,000 in a bank). If you lose your keys or get hacked, the money is gone. Custody matters, especially for a minor who can't manage their own wallet.

And it's worth saying plainly: Bitcoin could fail. The probability feels low after 17+ years, but it's not zero. Don't put in money your family can't afford to lose.

How to think about it

• Time horizon matters most. 15+ years? The volatility smooths out historically. 3-5 years? Much riskier.
• Size it appropriately. This isn't your kid's college fund (unless you're very comfortable with risk). It's a long-term asymmetric bet alongside their other savings.
• Custody is the real question. Where do you hold it? Cash App is easy but not ideal for long-term storage. A hardware wallet is more secure but requires you to manage the keys. Think about what happens if something happens to you.

Parent talking points

• “Why are you saving Bitcoin for me?” Because I think it might be worth a lot more when you're an adult, and I want to give you a head start. But I could be wrong, which is why we save in other ways too.
• “Can it go to zero?” Technically yes. Probably not, but that's why we don't put all our savings here.

Try this at home

The savings jar experiment (ongoing, ages 6+). Set up two jars (or envelopes): one labeled “Dollars” and one labeled “Bitcoin.” Each week, put a dollar in each. Track the Bitcoin price together once a week. After a month, show your kid how the dollar jar stayed the same but the Bitcoin jar's value went up or down. It's a hands-on lesson in volatility and saving.

Materials: Two jars, a few dollars, a phone to check the price. Time: 2 minutes/week.