Could a bitcoin-based indexed annuity be in the future?

By Susan Rupe

An insurtech holding company is seeking a fronting carrier and regulatory approval for a bitcoin-based indexed annuity.

BITLYF has spent the past three years developing the product, which gained traction earlier this year with the Chicago Board Options Exchange offering the first bitcoin index for an annuity.

James Eason, BITLYF cofounder, told InsuranceNewsNet bitcoin’s digital scarcity, portability and high upside potential make it ideal for annuities. He said this offers the 40- to 60-year-old demographic exposure to a high-growth asset while preserving principal protection.

BITLYF’s flagship product, the HODLife Bitcoin Strategy UNnuity, is a fixed indexed annuity. “HODL,” a term meaning to hold long-term, aligns with annuities’ focus on sustained investment, Eason said. The product features:

Fixed interest component. Guarantees returns, protecting principal regardless of market conditions, ensuring retirees’ peace of mind.
Bitcoin participation component. Offers exposure to the Cboe Bitcoin U.S. ETF Index, tracking spot bitcoin exchange-traded funds with a 99.9% correlation to bitcoin’s price. A zero-percent floor eliminates downside risk, and a 5% options budget supports hedging, aligned with FIA practices.

Eason said the HODLife UNnuity adheres to fiduciary standards with a transparent, fee-only structure — no commissions, surrender charges, withdrawal fees or market value adjustments. This design appeals to registered investment advisors and addresses consumer demand for diversified, low-risk exposure to bitcoin.

BITLYF seeks a U.S. life insurance carrier to underwrite this product, leveraging BITLYF’s digital asset expertise and the carrier’s infrastructure. This partnership aims to deliver a retirement solution that sets a new standard for bitcoin-linked products, Eason said.

Eason said the growth of bitcoin over the past decade makes it attractive for those who seek growth. And pairing a bitcoin index with an annuity is appealing to Generation X and older millennials, many of whom are familiar with bitcoin but might not yet be ready to consider buying an annuity.

“Bitcoin has grown more than 100% per year over the past 11 or 12 years,” he said. “So there's a real up and down. The annuitant doesn't get all of that 100% growth in this annuity product, but it is 10 times higher growth than the next closest competitor of its asset class.”

Bitcoin’s fixed supply of 21 million coins and growing demand drive its long-term value, despite short-term volatility, he said. Bitcoin’s price movements, largely independent of traditional markets, make it a hedge against inflation. The Cboe Bitcoin U.S. ETF Index provides insurance carriers with regulated, cash-settled options tied to bitcoin ETFs, enabling innovative financial products with reduced systemic risk.

Susan Rupe is editor in chief, magazine, for InsuranceNewsNet. She formerly served as communications director for an insurance agents' association and was an award-winning newspaper reporter and editor. Contact her at [email protected].