Choosing the Right Cryptocurrency for Gifting
With more than 27 million cryptocurrencies available by late 2025, selecting one can be daunting. If you’re considering a Christmas gift for someone who is not familiar with crypto, it’s best to choose well-established and well-known options.
There isn’t a universally “best” coin, as cryptocurrencies vary in objectives, age, and acceptance levels. Bitcoin (BTC), Ether (ETH), and highly rated currencies on platforms like CoinMarketCap or CoinGecko tend to have the longest histories, the largest user bases, and the greatest visibility. They are also broadly supported by crypto exchanges and wallet applications, which simplifies management for newcomers.
While newer or less expensive cryptocurrencies may boast rapid growth potential, they often experience sharp fluctuations and can be challenging for novices to handle or convert.
Crypto Gift Cards and Vouchers
Given the volatile nature of crypto assets, gifting cryptocurrency should be seen as a heartfelt gesture rather than a financial investment.
Crypto gift cards and specialized vouchers offer one of the simplest ways to introduce someone to cryptocurrency. They function similarly to traditional gift cards, representing a specific value of cryptocurrency instead of physical goods.
The process is easy. You purchase a digital code or physical card for a set amount of fiat currency, like $100. This card is your gift.
The recipient uses the code on the provider’s website or app, which then converts the cash value into the chosen cryptocurrency, like Bitcoin, at the prevailing market rate. The digital currency is then credited to an account created by the recipient.
This gift option is ideal for those unfamiliar with wallets or recovery phrases, allowing them to simply enter a code to receive their digital asset. Different providers may have varying availability, supported coins, and redemption processes, so it’s wise to read the terms carefully before buying.
Gifting Cryptocurrency via Hardware Wallets
For a substantial gift intended for long-term storage, a hardware wallet can mitigate certain security risks and offers a tangible item that can be wrapped.
Hardware wallets are compact physical devices designed for secure storage, keeping private keys offline. Since whoever possesses the key controls the assets, these wallets minimize the risk of hacks and malware as the keys never interact with the internet.
There are two main methods for using a hardware wallet as a gift. One is to preload cryptocurrency onto the device yourself. Alternatively, and often more securely, you can gift the unopened wallet and assist the recipient in setting it up, ensuring they alone know the recovery phrase.
If the device is lost or damaged, the recovery phrase (or seed phrase) is the only way to restore access to the wallet. Whoever holds that phrase can reach the funds.
Hardware wallets vary in features, pricing, and supported cryptocurrencies, allowing you to choose one that aligns with your budget and the recipient’s needs, whether for basic Bitcoin storage or multi-asset capabilities. Some models come with small displays, passphrase options, and companion applications.
Fun Fact: Besides money or gift cards, you can gift a non-fungible token (NFT), a unique digital asset secured by blockchain technology, transforming your gift into a distinctive collector’s item rather than just a monetary one.
Sending Cryptocurrency as a Gift via Exchanges and Wallets
If the person receiving the gift is more experienced with crypto, or if a direct money transfer is more practical, sending tokens through an exchange or self-custody wallet is another secure approach.
One popular option is to transfer cryptocurrency directly to the recipient’s wallet. However, this requires the recipient to already have a crypto wallet. Entering the wallet address incorrectly or sending funds via the wrong network can result in irreversible loss.
To obtain the wallet address, the recipient needs to access their wallet or exchange account and select the “Receive” or “Deposit” option for the desired cryptocurrency. This action will generate a unique public wallet address.
Then, you log into your wallet or exchange, select “Send” or “Withdraw” for that cryptocurrency, and enter the recipient’s address in the destination field. After confirming the amount and checking any applicable network fees, the transaction is processed on the blockchain.
If you opt for this method, ensure the address is accurate and consider sending a small test transaction prior to transferring the full gift amount.
Risks and Tax Considerations of Gifting Crypto
While gifting cryptocurrency is exciting, understanding the inherent risks and responsibilities is crucial.
Core Security Risks of Gifting Cryptocurrency
Recipients should realize that the value of cryptocurrencies can be highly volatile, with the gifted amount subject to significant fluctuations. Unlike traditional bank accounts, most crypto setups place security responsibility solely on the user.
New cryptocurrency users often fall prey to phishing schemes and deceptive links intended to compromise personal information. The golden rule is straightforward: never disclose your seed phrase under any circumstances.
Gifting and Tax Considerations
Cryptocurrency tax regulations vary significantly across countries, and recipients should always seek guidance from a qualified local tax professional.
Generally speaking, in many jurisdictions, merely gifting cryptocurrency or transferring ownership is not an immediate taxable event for either party, provided that the value stays within specific annual exclusion thresholds. In the US, this threshold is $19,000 per recipient for 2025.
Tax obligations typically arise for the recipient when they sell, trade, or otherwise dispose of the gifted crypto at a profit. To accurately calculate any future gains, the recipient will need to know the initial price paid by the giver and the date of acquisition. Sharing this information will assist the recipient in understanding how to navigate future tax calculations if they choose to sell the asset.
