Fidelity Investments is delving into the cryptocurrency industry with the formation of a new company: Fidelity Digital Asset Services.
With this new introduction, the investment firm aims to make digital currency more accessible to investors. The new company will be handling custody and executing trades on behalf of institutional investors. The institutional investors who will have access to the services are hedge funds, endowments, and family offices. These services will not yet extend into the retail space.
The new service offerings will allow for ease of use and understanding in the digital currency sphere for Fidelity’s client base. The financial giant has been operational for 72 years and administers upwards of $7.2 trillion in client assets, according to CNBC.
Fidelity Digital Asset Services
Fidelity Digital Asset Services will work with institutions who are new to the cryptocurrency space.
They will handle digital currency safe storage on investors’ behalf, removing risk factors from the crypto investment process. This new venture will place cybersecurity at the forefront by taking cryptocurrency offline and placing it in a cold wallet. Furthermore, they will execute trades through the use of an internal crossing engine and smart order router, also geared towards cybersecurity and the safety of client’s digital assets.
Fidelity and Cryptocurrency
This is not the firm’s first venture into the cryptocurrency. In fact, Fidelity already has Bitcoin and Ethereum mining operations and a partnership with Coinbase. Their Coinbase partnership allows their clients to view their crypto portfolios on the Fidelity app. They have also made a number of charitable donations in Bitcoin. Clearly, Fidelity is no stranger to the world of digital finance.
Digital Asset Services will make the adoption of cryptocurrency far simpler, all while lowering the perception of risk. Furthermore, it makes them one of the first of Wall Street financial institutions to facilitate crypto investments.
This development and others of its kind could open the door for cryptocurrency mass adoption, especially sectors with wary potential investors. Similarly, Lloyd’s of London recently announced that they will offer cryptocurrency insurance.