Will Cryptocurrency Enter Your TSP? Here’s What You Need to Know

After diving into cryptocurrency’s role in investment portfolios, federal employees might be wondering about their TSP accounts. While the direct answer is no – the TSP will not include cryptocurrency funds or crypto ETFs in its offerings – there’s an interesting twist to this story.

Your TSP funds may already have more connection to the cryptocurrency ecosystem than you realize. Through the C and S Funds, you likely have exposure to a growing web of companies involved in various aspects of the crypto economy. Let’s explore just how deep these connections go.

Take MicroStrategy, for example. This business intelligence company made waves by converting a significant portion of its treasury into Bitcoin – over 150,000 bitcoins at last count. When the company is included in the broader market indices that the C and S Funds track, your retirement savings are indirectly tied to Bitcoin’s performance through MicroStrategy’s holdings.

But the connections run much deeper than just companies holding crypto on their balance sheets. Consider the financial sector companies in your C Fund. Goldman Sachs now offers crypto trading services to its institutional clients. Morgan Stanley provides wealthy clients access to Bitcoin investments. Even traditional payment companies like Visa and Mastercard are deeply involved in crypto payment infrastructure. Every time these companies generate revenue from crypto-related services, C Fund investors indirectly benefit.

The technology sector, which makes up a significant portion of the C Fund, is particularly intertwined with crypto. NVIDIA, for instance, sees substantial revenue from crypto mining operations purchasing their graphics cards. IBM and Microsoft are developing blockchain infrastructure that underlies many crypto applications. Even Apple, the largest component of many market indices, is incorporating crypto-friendly features into its payment systems.

The S Fund, which invests in smaller companies, often has even more direct connections to crypto innovation. This fund has included companies like Silvergate Capital (a crypto-focused bank), Marathon Digital Holdings (a Bitcoin mining company), and Riot Platforms (another major crypto miner). When crypto markets are strong, these companies can significantly impact the fund’s performance.

Looking ahead, this indirect exposure is likely to grow. Traditional financial companies are rapidly building crypto capabilities – from custody services to trading platforms. Technology companies continue to develop blockchain applications. And more businesses are exploring ways to incorporate digital assets into their operations.

For federal employees, understanding these connections has practical implications. While you can’t directly buy crypto through your TSP, you’re not entirely insulated from the crypto economy. Your retirement savings are already participating in the broader digital asset transformation – albeit in a measured, indirect way through established companies navigating this new frontier.

This indirect exposure might actually be a more prudent way to participate in the crypto economy’s growth. Rather than dealing with the extreme volatility of direct crypto investments, TSP investors gain exposure through companies that are building real businesses around blockchain technology and digital assets, while still maintaining their traditional revenue streams.

The bottom line? While you won’t see Bitcoin or other cryptocurrencies directly listed in your TSP funds, your retirement savings are already part of the evolving digital asset landscape.

Understanding these connections can help you better assess your overall crypto exposure – especially if you’re considering additional crypto investments outside your TSP.

A note about the TSP Mutual Fund Window: While some mutual funds in the broader market do offer crypto exposure, you’ll need to check TSP.gov or consult with the TSP directly about whether any crypto-related funds are currently available through the window, as fund offerings and policies can change.