Charles Schwab, a leading U.S. brokerage managing over $10 trillion in assets, plans to launch spot cryptocurrency trading by April 2026, as announced by CEO Rick Wurster during the company’s 2025 Spring Business Update. The move will allow clients to directly buy and sell cryptocurrencies like Bitcoin and Ethereum through their Schwab accounts, marking a significant shift for the firm, which currently offers crypto exposure through ETFs, futures, and closed-end funds.

The decision is driven by a 400% surge in traffic to Schwab’s crypto-related web content, with 70% from non-clients, signaling strong public interest. Wurster highlighted an evolving U.S. regulatory environment as a key enabler, with anticipated clarity under new leadership potentially facilitating the launch. Schwab’s entry into spot crypto trading aims to meet rising client demand and compete with platforms like Coinbase, Fidelity, and Robinhood, which already offer similar services.

The firm has also taken steps to bolster its crypto strategy, including appointing Joe Vietri as Head of Digital Assets in February 2025 and partnering with Trump Media and Technology Group to launch Truth.Fi, a platform offering crypto and traditional financial products. Analysts, including Nate Geraci of ETF Store, view this as a potential game-changer for mainstream crypto adoption, though the high volatility and regulatory risks of crypto remain a concern for investors.

As a trusted financial giant with over $10 trillion in assets, Schwab’s move legitimizes cryptocurrencies, potentially accelerating their integration into traditional finance. This could attract conservative and institutional investors who have been hesitant, boosting overall market participation. Schwab’s entry intensifies competition among platforms like Coinbase, Fidelity, and Robinhood. This could lead to lower trading fees, improved services, and innovation in crypto offerings, benefiting consumers but pressuring smaller platforms’ market share.

Schwab’s decision, tied to anticipated U.S. regulatory clarity, may push regulators to finalize frameworks for crypto trading and custody. This could set industry standards but also introduce stricter compliance costs, impacting smaller firms disproportionately. Increased accessibility through Schwab’s platform could drive higher trading volumes and liquidity for major cryptocurrencies like Bitcoin and Ethereum. However, it may also amplify price volatility, especially during speculative market cycles, posing risks to retail investors.

The 400% surge in crypto-related web traffic, particularly from non-clients, suggests Schwab could capture a younger, tech-savvy demographic. Partnerships like Truth.Fi with Trump Media may further diversify its user base, though political affiliations could alienate some clients. Offering spot crypto trading exposes Schwab and its clients to crypto’s high volatility and cybersecurity risks. While ETFs and futures provide indirect exposure, direct trading increases potential losses, which could lead to reputational risks if not managed properly.

Schwab’s move may pressure other traditional brokerages (e.g., Morgan Stanley, Bank of America) to follow suit, accelerating the convergence of traditional and digital finance. This could reshape wealth management, with crypto becoming a standard portfolio component. Overall, Schwab’s entry is a pivotal step toward crypto’s mainstream integration, but it introduces competitive, regulatory, and risk-related challenges that will shape the financial landscape.

Charles Schwab’s planned launch of spot cryptocurrency trading by April 2026 introduces several tax implications for U.S. investors, given the IRS’s treatment of cryptocurrencies as property. Selling crypto for fiat, trading one cryptocurrency for another, or using crypto to purchase goods/services triggers capital gains tax. For Schwab clients, trading Bitcoin or Ethereum directly on the platform will create taxable events.

Taxed as ordinary income (10–37%, depending on income level). For example, if a client buys Bitcoin and sells it within six months at a profit, the gain is taxed at their income tax rate. Taxed at 0–20%, based on income. Holding crypto for over a year before selling on Schwab’s platform can significantly reduce tax liability. Gains/losses are calculated as sale proceeds minus cost basis (purchase price + fees). Schwab’s platform may provide transaction records, but clients must track their cost basis.

Income from staking, mining, or receiving crypto as payment (e.g., through Schwab’s potential integration with Truth.Fi) is taxed as ordinary income at fair market value on the receipt date (10–37%). For example, if a client earns 0.5 ETH from staking at $2,000 per ETH, they report $1,000 as income. If earned crypto is later sold, any gain over the fair market value at receipt triggers capital gains tax.

Starting January 1, 2025, Schwab, as a broker, must report crypto transactions to the IRS via Form 1099-DA, including gross proceeds. From 2026, cost basis reporting is also required, simplifying tax filing but increasing IRS oversight. Form 8949 and Schedule D: Clients must report capital gains/losses on Form 8949 and summarize them on Schedule D (Form 1040). Schwab’s transaction data will aid this process, but clients with external wallets must consolidate records.

As of 2025, investors must track cost basis by wallet, not universally. Transfers between Schwab’s platform and personal wallets require careful record-keeping to avoid misreporting. Selling crypto at a loss can offset capital gains and up to $3,000 of ordinary income annually. Unlike stocks, crypto is not subject to the wash sale rule, so clients can sell at a loss on Schwab’s platform and immediately repurchase without losing the deduction. This is a key strategy for high-frequency traders.

Gifting crypto (up to $19,000 per recipient in 2025) is not taxable, but exceeding this limit requires filing Form 709. Schwab’s platform may facilitate gifting, especially via Truth.Fi. Donating crypto to charities is tax-deductible at fair market value if held over a year, with no capital gains tax. Donations over $5,000 require a qualified appraisal.

Crypto losses from theft are deductible only if linked to a federally declared disaster area (post-TCJA rules). Assets devalued to less than $0.01 cannot be claimed as losses without a sale. Clients using Schwab’s custodial services may face fewer theft risks but should be aware of these limits. Failing to report crypto transactions can lead to fines up to $100,000, audits, or criminal charges. Schwab’s Form 1099-DA reporting will make unreported transactions more traceable, increasing compliance pressure.

Some states (e.g., California) treat crypto as cash for sales tax, while others (e.g., Texas) exempt it. Schwab clients must check state-specific rules, as federal capital gains taxes apply uniformly but state taxes vary. Holding crypto for over a year qualifies for lower long-term capital gains rates, ideal for Schwab’s buy-and-hold investors.

Tools like CoinLedger or TaxAct can integrate with Schwab’s data to automate Form 8949 preparation, reducing errors. Prepare for Form 1099-DA and wallet-specific accounting by maintaining detailed records now. High-volume traders or those with complex transactions (e.g., DeFi via Truth.Fi) should work with crypto tax accountants to navigate evolving rules.

Schwab’s entry simplifies access but amplifies tax complexity due to increased transaction volume and IRS scrutiny. Clients should leverage Schwab’s reporting tools, maintain meticulous records, and consider tax-advantaged strategies to minimize liabilities. For personalized advice, consult a tax professional familiar with crypto regulations.