How to Buy Bitcoin for My Child: A Step-by-Step Guide

I bought my first Bitcoin on Cash App in 2019. Took about 90 seconds. The problem wasn't buying it. The problem was figuring out where to keep it, how much to buy, and what happens when your kid turns 18 and you hand them the keys.

To buy Bitcoin for your child, open an account on a Bitcoin-focused exchange like River (0% fees on recurring buys) or Strike, set up a weekly auto-purchase of $10-50, and withdraw to a hardware wallet once you've accumulated $200-500+. Track your cost basis for tax purposes, because when you eventually gift the Bitcoin to your child, that basis transfers to them.⁶

Which exchange should parents use to buy Bitcoin?

You're buying Bitcoin in your name, on behalf of your kid. Minors can't open accounts on any major exchange.¹ So you need an account first. (More on why in our can minors own Bitcoin guide.)

My recommendations, ranked by how much I trust them for long-term holding:

• River (0% fees on recurring buys,² auto-withdrawal to your own wallet, Bitcoin-only). Best for parents who want a set-it-and-forget-it approach.
• Strike (fees around 0.3%,³ simple interface, supports auto-buy). Great if you want to stack sats on a schedule without thinking about it.
• Cash App (spread around 1.5-2.5%⁴). Fine for getting started. Not ideal for large amounts or long-term storage.
• Coinbase (largest US exchange, decent security, but sells hundreds of altcoins). More buttons to push than you need if Bitcoin is all you want.

If your goal is a long-term savings plan for your kid, River or Strike are the cleanest options. They don't try to sell you 400 other tokens.

How should parents set up recurring Bitcoin purchases?

Don't try to time the market. I promise you won't be good at it. (I wasn't.)

Set up a weekly or monthly auto-buy. $10/week, $25/month, $50/month, whatever fits your budget. This is called dollar-cost averaging (DCA). You buy the same dollar amount on a schedule, regardless of price. When Bitcoin is down, you get more sats. When it's up, you get fewer. Over years, it smooths out.

River and Strike both let you set this up in about 2 minutes. Link your bank account, choose your amount, pick your frequency. Done. If you want the full playbook on amounts and frequency, see our Bitcoin savings plan guide.

Where should I store Bitcoin I'm holding for my child?

This is the most important decision and the one most parents skip.

• Leave it on the exchange (easiest, least secure). Fine for small amounts under $500. If the exchange gets hacked or goes bankrupt (remember FTX lost $8 billion in customer funds⁵), your Bitcoin is gone.
• Hardware wallet (most secure, requires some setup). A Coldcard, Trezor, or Ledger device stores your keys offline. Nobody can hack what isn't connected to the internet. This is what I recommend for anything you're holding long-term for your kids. (Full setup walkthrough in our wallet guide.)
• Multisig custody (advanced, maximum security). Services like Unchained let you set up 2-of-3 multisig vaults. You hold 2 keys, they hold 1 as backup. Overkill for $50/month, but worth considering once you've stacked a meaningful amount.

What are the tax rules for buying Bitcoin for a child?

The IRS considers Bitcoin property, not currency.⁶ When you eventually transfer it to your kid or sell it, there are tax implications.

• Gifting: You can gift up to $18,000 per year (2024 limit) per recipient without filing a gift tax return.⁷ Most parents won't hit this with Bitcoin savings.
• Cost basis transfers: When you gift Bitcoin, your cost basis (what you paid) transfers to your kid.⁶ If you bought at $30,000 and they sell at $100,000, they owe capital gains on the $70,000 difference.
• UTMA/UGMA accounts: Some parents use custodial accounts. The asset belongs to the child, but you manage it until they reach the age of majority (18 or 21, depending on your state).⁸

Talk to a CPA if you're stacking serious amounts. For $25/month, you probably don't need to stress about it yet.

What does a real Bitcoin savings plan look like?

I buy on River with a recurring weekly purchase. Once a quarter, I withdraw to a hardware wallet. I keep a spreadsheet with dates, amounts, and prices (cost basis tracking). It takes about 5 minutes a quarter.

Saylor's framing resonates here: “You want to fix your family? Give them an endowment that'll last forever.”⁹ That's the long game. The Bitcoin is technically in my name. When my kids are old enough to understand custody and responsibility (I'm thinking 16-18), I'll transfer it to wallets they control. Until then, I don't want a teenager with a $20,000 hot wallet and zero impulse control.

How do I explain Bitcoin buying to my kid?

• “Why don't you just put the money in a bank?” I do that too. But bank savings accounts earn about 0.01-4.5% interest. I think Bitcoin might do better over 15+ years. It's a bet, not a guarantee. (Here's how banks actually work if they want the full picture.)
• “How much Bitcoin do I have?” Right now, [X] sats. That's [X] dollars at today's price. But the dollar amount will bounce around a lot. What matters is the number of sats, because that never changes.
• “Can I spend it?” Not yet. This is long-term savings. We'll talk about when it makes sense to use it when you're older.

Try this at home

First purchase together (15 minutes, ages 10+). Sit down with your kid and buy $5 of Bitcoin together. Use Cash App or Strike (both have simple interfaces). Walk them through each screen. Show them the order, the fees, the confirmation. Then pull up a Bitcoin block explorer (mempool.space) and find the transaction together. It makes it real.

Materials: A phone, $5, a Cash App or Strike account. Time: 15 minutes.

Sources

1. FinCEN, Money Services Business Definition (KYC requirements for exchanges)
2. River Financial, Recurring Buying on River (0% fee on recurring purchases)
3. Strike, Strike Fee Schedule
4. Cash App, Bitcoin Fees
5. Reuters, “How FTX Collapsed” (Nov 2022)
6. IRS, Frequently Asked Questions on Virtual Currency Transactions
7. IRS, Frequently Asked Questions on Gift Taxes (2024 annual exclusion: $18,000)
8. Uniform Law Commission, Uniform Transfers to Minors Act
9. Saylor, Michael. Interview with Peter Voogd, discussing Bitcoin as a generational endowment