TLDRFidelity Digital Assets agreed to pay California $500,000 to settle claims over past crypto withdrawal limits.Fidelity must give written notice if it stops letting retail customers transfer crypto to outside wallets.Crypto IRAs are excluded from the transfer terms and are still not offered in California or Oregon.Fidelity denies wrongdoing, and the deal does not create a customer compensation fund.California customers have been able to move crypto off the platform since June 2025.Fidelity Digital Assets has agreed to pay $500,000 to settle a California investigation into past limits on crypto withdrawals. The deal also adds a promise to warn customers before ending crypto transfers.California Attorney General Rob Bonta announced the settlement on Oct. 16. It centers on claims about withdrawal restrictions at Fidelity Digital Asset Services.The settling company, Fidelity Digital Assets, National Association, is the successor to that entity. Fidelity denies any wrongdoing and did not admit to breaking any law.What the Settlement RequiresThe $500,000 payment goes to the attorney general’s office. It covers fees and costs tied to the investigation and settles the potential claims released in the deal.The agreement does not set up a fund to pay back customers.The settlement describes a period from November 2022 through April 2025. During that time, California retail customers could buy and sell crypto on Fidelity but could not send it directly off the platform.Fidelity received regulatory permission in April 2025. The transfer feature then reached all California customers by June 2025.The agreement recognizes that customers can now move crypto to outside wallets, subject to applicable law. If Fidelity decides to stop offering this feature to retail customers, it must give California customers reasonable written notice.Fidelity still keeps the right to restrict or block transfers. It can do this to protect its platform or individual account holders.Crypto IRAs Follow Separate RulesTax-advantaged accounts are not covered by the transfer terms. This includes individual retirement accounts, also known as IRAs.The deal also excludes accounts subject to federal rules on tax-free transfers between retirement accounts.The agreement says Fidelity plans to launch Fidelity Crypto IRA accounts in California. It does not give a launch date.Fidelity’s current IRA help page says the product is still not available in California or Oregon.In states where the Crypto IRA is offered, customers cannot transfer crypto. They also cannot withdraw money or crypto directly from the account.Instead, they can move money from the account’s U.S. dollar position to a linked Fidelity brokerage IRA. From there, they can use that account’s withdrawal options.Fidelity’s state availability page, checked on Oct. 18, still lists crypto deposits and withdrawals for regular Fidelity Crypto accounts in California.The post Fidelity Pays $500,000 to Settle California Crypto Withdrawal Probe appeared first on Blockonomi.