Fidelity Investments 2025: Stablecoin Tests, 401(k) Access Fight and What Comes Next for a $17.5 Trillion Giant

Updated: December 2, 2025 – This article reflects information available as of this date and may not capture later developments. Nothing here is individual investment advice.

Key Takeaways

Fidelity’s scale keeps climbing: Client assets under administration have reached about $17.5 trillion, with $6.8 trillion in discretionary assets and sharply higher digital engagement as of Q3 2025. ^[1]
Retirement balances hit record highs: Average 401(k), IRA and 403(b) balances are at all‑time highs; the average 401(k) is around $144,400, up 5% quarter‑over‑quarter and roughly 9% year‑over‑year. ^[2]
401(k) access is a flashpoint: New Fidelity security rules blocking certain third‑party tools (notably Pontera) from logging into 401(k) accounts have triggered client lockouts, industry criticism and fresh scrutiny over control of “held‑away” assets. ^[3]
Crypto and stablecoins are central to the strategy: Fidelity runs one of the largest spot bitcoin ETFs and a growing crypto platform, and is actively testing a dollar‑pegged stablecoin, though it says there is no immediate launch plan. ^[4]
Products are being reshaped: The firm is liquidating five thematic and sustainable ETFs while pushing model portfolios, alternatives and small‑cap strategies, signalling a focus on scale and advisor‑friendly building blocks. ^[5]
Legal and ESG pressure is rising: Fidelity is suing Broadcom over critical software access, is named in a new ERISA lawsuit over 401(k) fees, and is under the same climate‑policy pressure hitting other large asset managers. ^[6]
Fidelity’s own outlook calls for late‑cycle caution: Its 2025–2026 market outlooks emphasize record equity markets, persistent inflation drivers (tariffs, AI), and the need for diversification across asset classes and regions. ^[7]

1. Where Fidelity Investments Stands in Late 2025

Fidelity Investments, still privately held by the Johnson family and employees, remains one of the world’s largest asset managers. As of its Q3 2025 business update, the firm reported: ^[8]

$17.5 trillion in assets under administration (AUA), up about 17% year‑over‑year
$6.8 trillion in discretionary assets, up roughly 18% year‑over‑year
4.4 million daily average trades, up 30% from the prior year
Nearly 28.5 million unique digital visitors across Fidelity.com, NetBenefits, Wealthscape and its apps

The firm says it employs more than 78,000 people worldwide and has been privately held for 79 years. ^[9]

A recent Financial Times profile underscored Fidelity’s unusually dominant role in U.S. retirement and brokerage investing, describing it as a central gatekeeper for Main Street’s savings even as it remains under the tight control of the Johnson family. ^[10]

Under CEO Abigail (Abby) Johnson, Fidelity has leaned hard into alternatives and digital assets. American Banker’s ranking of the “Most Powerful Women in Finance” put Johnson at No. 3 in 2025, highlighting her focus on asset classes that “couldn’t even be traded on an exchange a year ago,” including spot bitcoin ETFs and private market strategies. ^[11]

2. Retirement Savers Hit Record Highs

Fidelity’s Q3 2025 Retirement Analysis paints a picture of savers benefiting from strong markets and steady contribution habits: ^[12]

Average 401(k) balance: about $144,400, up 5% from Q2 and 9.1% year‑over‑year
Average IRA and 403(b) balances also hit new records
Combined employer + employee 401(k) savings rates remain at record levels
More than 9,200 Fidelity 401(k) plans have adopted auto portability since 2022, helping workers consolidate small, stranded accounts

External coverage notes that the number of “401(k) millionaires” at Fidelity has reached an all‑time high, driven by long‑tenured savers who stayed invested through volatility. ^[13]

Fidelity links these balances to a decade‑plus push into workplace benefits and IRAs; it is now the largest IRA provider in the U.S. and administers retirement savings for over 50 million accounts. ^[14]

The Great Wealth Transfer: Fidelity’s Family & Finance Study

The 2025 Family & Finance study adds another dimension: trillions in boomer wealth moving to younger generations—but with major communication gaps. Fidelity reports that: ^[15]

97% of families say estate‑planning conversations are important
Nearly half have not actually had those conversations
52% of parents haven’t told their children their net worth
95% of adult children believe they’re ready to manage inherited wealth, but many parents disagree

Media coverage has framed this as a warning: without clear conversations, even well‑funded retirements can give way to family conflict or poor stewardship of inherited wealth. ^[16]

For Fidelity, this research supports a broader wealth‑management push: more family meetings, inter‑generational planning and services like the Fidelity Center for Family Engagement, which operates alongside (but separately from) its advisory and brokerage entities. ^[17]

3. The 401(k) Access Fight: Security vs. Investor Choice

One of Fidelity’s most contentious moves in 2025 has been its crackdown on third‑party firms that log into 401(k) accounts on clients’ behalf.

What Changed

Beginning with policy changes announced in late 2024 and enforced more aggressively this year, Fidelity said it would limit or block “credential sharing” and similar methods that let outside platforms access participant accounts using client usernames and passwords. ^[18]

Firms affected include Pontera, a fintech that allows independent advisors to manage clients’ 401(k)s and other “held‑away” accounts without transferring custody. Media reports and local TV coverage describe cases where participants who had linked their employer plan to such tools: ^[19]

Received notices from Fidelity that their logins might be disabled
Lost online access temporarily after refusing to disconnect their advisor’s tool
Regained access only after calling Fidelity directly and working with their advisor

Fidelity argues the policy is about cybersecurity and data protection, warning of risks when third parties can execute trades or other “high‑risk actions” through shared credentials or screen‑scraping methods. ^[20]

Pushback from Advisors and Pontera

Advisors and Pontera see it differently. In an open letter and media interviews, Pontera accuses Fidelity of an “anticompetitive power grab” that pushes investors toward in‑house advice and limits choice in who can manage their largest savings account. ^[21]

Several advisor publications and 401(k) industry outlets have framed the dispute as a test case for “held‑away asset” management—and whether recordkeepers like Fidelity will keep tightening control over plan data in the name of security.

New 401(k) Fee Lawsuit

Separate from the access issue, Fidelity is also named (alongside insurer Centene) in a new ERISA lawsuit alleging excessive 401(k) fees and misuse of forfeited assets in a corporate retirement plan. The complaint targets Fidelity Investments Institutional and Fidelity Management Trust as recordkeeper and trustee, arguing participants paid more than necessary. ^[22]

These are allegations at an early stage, and Fidelity has not publicly detailed its legal response. But combined with the credential‑sharing controversy, they underline how central—and scrutinized—Fidelity has become in the U.S. retirement system.

4. Crypto, Bitcoin ETFs and the Stablecoin Experiment

A Leading Spot Bitcoin ETF

Fidelity is now a central player in mainstream crypto investing. Its Wise Origin Bitcoin Fund (FBTC) has grown into one of the largest spot bitcoin ETFs in the U.S.; as of September 2025 it held roughly $21.7 billion in assets, making it the second‑largest spot bitcoin ETF and the largest of Fidelity’s 79 ETFs. ^[23]

Fidelity also offers single‑asset crypto ETPs tied to bitcoin, ether and solana, and runs a dedicated Fidelity Crypto platform that lets U.S. retail clients trade certain cryptocurrencies and crypto‑focused ETFs within its brokerage ecosystem. ^[24]

In Canada, Fidelity reduced the management fee on its Fidelity Advantage Bitcoin ETF in early 2025, signalling its intention to compete aggressively on price in that market as well. ^[25]

Big‑Bank Validation: Bank of America Opens the Door

On December 2, 2025, CoinCentral reported that Bank of America will allow its wealth‑management clients to allocate 1–4% of their portfolios to bitcoin ETFs, including Fidelity’s Wise Origin Bitcoin Fund, via Merrill and the Private Bank starting January 5. ^[26]

The move means Fidelity’s crypto products are now endorsed inside one of the largest U.S. bank advisory platforms, where strategists are explicitly recommending a small crypto allocation for suitable, high‑risk‑tolerant clients.

Stablecoin Tests: Cash on the Blockchain

In March 2025, Reuters and the Financial Times reported that Fidelity is testing a dollar‑pegged stablecoin through its Fidelity Digital Assets division. The token would be designed to hold a 1:1 value with the U.S. dollar and could eventually serve as the “cash” leg of a tokenized U.S. dollar money‑market fund. ^[27]

Subsequent reporting and commentary clarify that: ^[28]

Fidelity is “actively testing” the stablecoin but says there are no immediate plans to launch
The project is overseen by Fidelity Digital Assets, alongside a tokenized money‑market fund initiative
Management sees stable‑value crypto as an infrastructure piece that could support digital trading, settlement and on‑chain money‑market products

This comes as global stablecoin adoption accelerates and regulators tighten oversight. Analysts at JPMorgan, for instance, estimate stablecoins could add $1.4 trillion in extra demand for U.S. dollars by 2027 if adoption keeps rising. ^[29]

At the same time, S&P Global’s recent downgrade of Tether’s reserves to “weak” highlights how reserve quality and transparency will be crucial for any new entrant, especially a household brand like Fidelity. ^[30]

Fidelity’s Crypto Outlook

Fidelity Digital Assets’ mid‑year 2025 outlook described crypto markets as being in a more mature phase of the cycle, with bitcoin increasingly behaving as a macro‑sensitive risk asset while still offering diversification benefits for small allocations. It emphasized high volatility, regulatory uncertainty and the possibility of losing an entire crypto investment—caveats Fidelity repeats across its digital‑asset materials. ^[31]

5. Re‑Shaping the Product Shelf: ETF Liquidations and Model Portfolios

Liquidation of Five ETFs

On October 16, 2025, Fidelity announced it would liquidate five exchange‑traded funds: ^[32]

Fidelity Digital Health ETF (FDHT)
Fidelity Sustainable Core Plus Bond ETF (FSBD)
Fidelity Sustainable Low Duration Bond ETF (FSLD)
Fidelity Sustainable U.S. Equity ETF (FSST)
Fidelity Women’s Leadership ETF (FDWM)

Key dates:

Last full trading day: November 13, 2025
Expected liquidation date: on or about November 20, 2025

After November 13, shares stopped trading and the funds moved into cash and liquid assets ahead of liquidation, with proceeds distributed to shareholders.

Fidelity framed the decision as part of a regular review of its ETF lineup, saying it wants to maintain a “differentiated and diverse suite of strategies” while focusing on products with enough scale. It still offers more than 70 ETFs and ETPs with about $144 billion in ETF assets under management as of September 30, 2025. ^[33]

The closure of sustainable and thematic funds mirrors a broader industry trend: niche ESG and thematic ETFs that never reached critical mass are being wound down, even as demand for sustainable investing continues in other wrappers.

All‑ETF Model Portfolios and Alternatives

Earlier in 2025, Reuters reported that Fidelity launched two all‑ETF model portfolios for wealth‑management firms: ^[34]

Fidelity Target Allocation ETF Model Portfolios – core, multi‑asset models
Fidelity Target Risk ETF Model Portfolios – complementary, risk‑tiered strategies including liquid alternatives

The models use a mix of Fidelity and third‑party ETFs and reflect the industry shift toward open‑architecture models as the default way advisors construct portfolios.

Separately, Barron’s and other outlets note that Fidelity has been weaving alternative investments into some advisory models—private credit, real estate and other non‑traditional assets—building on Johnson’s push into alts. ^[35]

Fidelity International has also launched a fund focused on U.S. small‑cap stocks, betting that an eventual broadening of the equity rally could favour smaller companies after years of mega‑cap dominance. ^[36]

6. Operational Risk and the Broadcom Lawsuit

On November 17, 2025, Reuters reported that Fidelity sued Broadcom in U.S. federal court, alleging that changes to Broadcom’s licensing for VMware virtualization software threatened Fidelity’s ability to run critical systems at scale. ^[37]

According to the suit, Fidelity argues that restrictive licensing could:

Limit its ability to maintain redundant systems
Increase the risk of outages across platforms serving tens of millions of customers
Force costly migrations or infrastructure changes

The case underscores a reality often invisible to investors: large asset managers depend on a handful of technology vendors, and disputes over licensing can become systemic‑risk issues when they affect trading, recordkeeping or retirement‑plan access.

7. ESG, Climate Politics and Public Pressure

Although much of the climate spotlight has focused on BlackRock and other publicly traded managers, Fidelity is increasingly drawn into the same debate.

A Financial Times report on New York City’s pension system detailed how NYC Comptroller Brad Lander pressed to pull mandates from managers seen as insufficiently aligned with the city’s climate expectations, naming large firms including Fidelity in the broader critique of net‑zero commitments and proxy‑voting records. ^[38]

At the same time, the decision to liquidate three sustainable ETFs has been interpreted two ways:

As evidence that investor appetite for certain ESG themes has cooled; or
As a rational pruning of smaller, overlapping vehicles while sustainable strategies continue inside broader mutual funds and separately managed accounts. ^[39]

Fidelity says it still offers a range of sustainable investing options and highlights its stewardship and proxy‑voting reports in its “Data & insights” section, but critics argue it could be more aggressive on climate‑related shareholder votes.

8. How Fidelity Sees the Markets: 2025–2026 Outlook

Late‑Cycle but Still Growing

In its “Economic Outlook: Fourth Quarter 2025”, Fidelity’s Asset Allocation Research Team (AART) describes a world where: ^[40]

Global equities recently hit record highs, helped by strong tech and AI‑linked earnings
The economic expansion in the U.S. and many developed markets has slowed but not reversed
Labour markets are cooling, yet wage growth and tariffs keep inflation from returning to pre‑pandemic levels
Returns are likely to be more “normalised”, with less help from multiple expansion and more from earnings and income

The June 2025 stock‑market outlook on Fidelity.com suggested stocks could be range‑bound through the second half of 2025, with bouts of volatility around central‑bank policy, election‑related uncertainty and geopolitical shocks. ^[41]

Asset‑Class Views

Across its 2025 outlook pieces, Fidelity has generally emphasized: ^[42]

Equities: Preference for “quality” companies with strong balance sheets and free cash flow; selective opportunities in value, small caps and non‑U.S. markets
Fixed income: Greater role for short‑to‑intermediate‑term high‑quality bonds as yields remain attractive; ongoing use of bond ladders and active management to navigate rate volatility
Real assets & gold: Potential hedge against sticky inflation and currency shifts, particularly as de‑globalization and industrial policy reshape supply chains
Alternatives: Private credit and other alts as tools for diversification and income (albeit with liquidity and complexity trade‑offs)

2026: Fragmentation and Currency Shifts

Fidelity International’s “Outlook 2026” goes a step further, arguing that: ^[43]

The world is likely to see persistent geopolitical fragmentation, trade conflicts and industrial policy
This environment may contribute to a weaker U.S. dollar over time and increased demand for alternative reserve assets
Gold and certain non‑U.S. assets could benefit if stablecoins, tokenized assets and shifting capital flows erode the dollar’s dominance at the margin

For everyday Fidelity clients, the practical translation of this outlook is simple: diversification matters more than ever, across asset classes, sectors and regions.

9. What All This Means If You Invest Through Fidelity

If you’re an individual or advisor using Fidelity today, here are the main practical implications of these 2025 developments:

1. Check Your 401(k) Connections and Access

If you or your advisor use a third‑party platform (like Pontera) to manage a 401(k) or other employer plan, confirm whether Fidelity’s credential‑sharing policies affect your account.
If online access has been restricted, Fidelity says clients can typically restore it by contacting the firm directly, but doing so may require decisions about which tools remain linked to your account. ^[44]

2. Understand the Risks of Crypto and Stablecoins

Spot bitcoin ETFs and crypto funds available on Fidelity’s platform can offer convenient exposure—but they remain high‑volatility, high‑risk assets that can suffer large drawdowns.
The fact that Bank of America and other big banks now allow limited allocations doesn’t change the risk profile; it simply shows how mainstream the asset class has become. ^[45]
Fidelity’s stablecoin tests are early‑stage experiments, not a ready‑for‑prime‑time product. Treat any future launch as you would any other cash‑like instrument: by scrutinizing reserves, regulations and issuer transparency. ^[46]

3. Watch for ETF and Fund Changes

If you hold any of the five ETFs being liquidated (FDHT, FSBD, FSLD, FSST, FDWM), be sure you understand the liquidation timeline and tax consequences. ^[47]
Expect more evolution in Fidelity’s product line—new model portfolios, alternative strategies and potential expansions in areas like small caps and private markets.

4. Don’t Ignore Operational and Legal Risk

The Broadcom lawsuit is a reminder that even sophisticated platforms rely on third‑party tech. While investors can’t control those disputes, it’s a reason to use features like multi‑factor authentication, keep contact info updated and know how to access accounts via phone or alternative channels in case of an outage. ^[48]
Lawsuits over fees and plan design are common across the retirement industry. If you’re in a workplace plan where Fidelity is the recordkeeper, focus on what you can control: contribution rates, investment mix and use of advice or planning tools.

5. Align Your Strategy With Fidelity’s (and Your Own) Outlook

Fidelity’s own research expects moderate growth, higher‑than‑pre‑COVID inflation and more volatility. That generally supports balanced, diversified portfolios rather than all‑in bets on any single theme—whether AI, U.S. mega‑caps or crypto. ^[49]
None of this replaces a personalized plan. If you’re unsure how to translate these trends into action, consider using Fidelity’s planning tools or talking with an advisor—at Fidelity or elsewhere—who can factor in your risk tolerance, time horizon and tax situation.

Bottom line:

As of December 2, 2025, Fidelity Investments is simultaneously bigger, more innovative and more controversial than ever. It’s pushing into crypto and stablecoins, pruning and re‑tooling its ETF lineup, expanding models and alts for advisors, and sitting at the center of heated debates over 401(k) access, climate policy and retirement plan fees.

For investors, the key is not to follow every headline, but to understand how Fidelity’s strategic moves affect your fees, access, product lineup and risk exposure—and to keep your own long‑term plan firmly in the driver’s seat.