Cash in little wrapped boxes or tucked inside Hallmark cards is one of the most reliable and beloved gifts. But this holiday season, cash gifts are taking a new form as cryptocurrencies and nonfungible tokens, or NFTs.

Giving digital money requires planning, though, as you can’t simply buy one of these assets and send someone a link. Instead, they need someone to have a digital wallet already created, through a provider such as Rainbow, MetaMask or

Coinbase.


COIN 8.81%

The wallet then holds the assets, effectively acting as a bank account.

“There’s a fixed cost to getting started, and there’s no way around that,” said

Lex Sokolin,

head economist and global fintech co-head at ConsenSys, a blockchain software technology company. “It is like you’re showing up to your friend’s house in 2002 and giving them an MP3 player and saying, ‘Here’s an MP3 player, now go throw out all your CDs.’”

Hassles aside, many parents, children and even friends are embracing these new products—at least for the more digital-savvy in their lives. Just as stock certificates and savings bonds were gifts with a purpose in years past, gifts of crypto or NFT art can teach the recipient about financial independence, investing and saving.

“Giving money is also giving an education,” said Shari Greco Reiches, wealth manager and co-founder of Rappaport Reiches Capital Management.

With that spirit in mind, here are some of the most 2021 ways to give money—not a gift card in sight.

Crypto starter packs

One easy way to help someone dip a toe into the world of digital currency is giving them a makeshift crypto starter pack.

Alex Salnikov,

co-founder and head of product of NFT marketplace Rarible, said he has set up wallets for friends with the promise of then giving them an NFT on the other side. He also recommends products such as Linkdrop, which allow the giver to send onboarding links to begin setting up their own wallets.

Coinbase offers an option to share crypto assets with those not yet set up on their network, along with a message and a “fun little welcome,” said

John Zettler,

senior product manager at Coinbase. Setting up a wallet on Coinbase is free.

“These are effectively the keys to the community, and with it you make the person a part of said community,” Mr. Salnikov said.

Currency

If someone has already set up their own crypto wallet, Mr. Salnikov recommends giving them the coin or cryptocurrency most useful for their preferred activities, just as you might choose a gift card for their favorite store, rather than a generic

Visa

gift card.

Unlike setting up the wallet—free on many platforms—these coins don’t run cheap. Bitcoin rose in price from $30,000 at the end of 2020 to nearly $70,000 in 2021. Ethereum, another popular coin, is less expensive at close to $4,300. You can purchase portions of cryptocurrency, however, and every bitcoin is divisible, which means you can buy a slice of one at almost any amount you would like.

Memecoins, or a cryptocurrency related to an Internet joke, such as dogecoin, won’t set you back as much. (At its peak, dogecoin reached 75 cents in May 2021.) Sending these is “really like the financial equivalent of sending a funny cat picture,” Mr. Sokolin said.



Photo:

Jan Buchczik

NFTs

NFTs are best described as vouchers of authenticity for digital assets, be it art or music or anything else. They have surged in popularity this year, only a few years after they were first created in 2017. Marketplaces such as Rarible, Open Sea and Nifty Gateway can offer multiple ideas for NFT gifts, such as an animated rainbow cat illustration for 0.6 Ethereum and a GIF of dancing Taco Bell tacos for 4 Ethereum.

“It’s a unique digital 1-1 item that only you can own, and that can represent so many different things. So it comes down to: What does the recipient of the gift like?” Mr. Zettler said.

Depending on the desirability and availability of the given item, NFTs can also rise in value. NBA Top Shot allows users to purchase key moments in basketball history; legendary auction house Christie’s now offers original works of art to be purchased as NFTs; and bands such as Kings of Leon are releasing albums as NFTs.

Keep an eye on the price tag: These original collectibles can cost anywhere from a single dollar to the multimillions.

Financial products for children

Setting up a custodial investment account for a child can introduce them to investing, said

Jordan Wexler,

co-founder and chief executive of gifting platform EarlyBird.

Many brokerages and firms offer this option. Mr. Wexler’s product allows parents, grandparents or other adult gift givers to set up custodial investment accounts for children from birth, complete with video messages for particular celebrations, such as holidays and birthdays.

“There’s such an interesting movement in people not wanting waste anymore and leaning heavily into, ‘How can you charge something emotionally, more than a toy you give?’ ” Mr. Wexler said.

Givers can give anywhere from $15 to $2,500 at a frequency of their choice, doing so as either a recurring or one-time deposit.

Ms. Reiches has a more traditional recommendation: Give money to a 529 plan, which allows parents, grandparents and other adults to invest money that can be used for a beneficiary’s qualified education expenses.



Photo:

Jan Buchczik

Memestocks

Memestocks surged at the start of this year. Then they fell. Then they rose again. Amid it all,

GameStop,

AMC and other tickers have become household names.

Giving a share of these stocks is one option to bet on memestocks. You can also purchase a fractional share, Ms. Reiches said. Showing your recipient how to track the progress of their investment can be its own experience.

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Photo:

Jan Buchczik

“Talk to the child about what companies they like and what companies they’re following,” she said. “It can teach discipline, long-term thinking and delayed gratification.”

Tungsten cubes

The Tungsten cube holds special appeal for people who want to take the intangible—the world of cryptocurrency, NFTs and decentralized finance—and make it tangible. These crypto enthusiasts do so with small gray cubes of the metal tungsten, a substance nearly twice as dense as lead. The cubes run anywhere from $400 for a 2-inch cube to $3,000 for a 4-inch cube.

Nic Carter, one of the original champions of the cube, said he has previously given them to family and friends for the holidays. But for those out of the joke, the gift may not resonate the way you hope.

“I’d only recommend that as a gift of someone who’s very, very into crypto and on crypto

Twitter.

Otherwise they’re going to stare at you with a blank face like, ‘What is that?’ ” Mr. Zettler said.

Shiba Inu Coin’s recent surge, and subsequent fall in value, is part of a growing trend of meme coins that are rivaling some of the largest digital tokens in the world. WSJ retail investing reporter Caitlin McCabe explains why investors are pouring money into this meme based cryptocurrency. Photo: Amber Bragdon/Getty Images

Write to Julia Carpenter at Julia.Carpenter@wsj.com

Copyright ©2021 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8



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