A Look at the New Bitcoin Institutional Platform By Fidelity

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Reading Time: 2 minutes(Last Updated On: December 4, 2018)

This Article is Originally Posted on MintDice.com

Fidelity Investments has recently announced the launch of a separate arm, which will give its institutional clients the opportunity to trade in cryptocurrencies like Bitcoin. The arm, known as Fidelity Digital Asset Services, LLC, will buy and sell digital currencies for various monetary ventures such as hedge funds and family offices.

According to the press release, the firm will source all of its cryptocurrency from large, over-the-counter exchanges. They will also be safely kept in a cold storage to ensure that customer funds are safe from theft.

WHAT IS FIDELITY INVESTMENTS?

Fidelity is one of the most prominent financial institutions in the world. Currently, the world’s fifth-largest asset manager, the firm currently provides financial services worth up to $7.2 trillion in customer assets.

Fidelity Investments offers personal investment services including financial planning. It also handles retirement plans like annuities and IRAs, as well as college savings accounts and similar financial services. Apart from personal investment services, Fidelity offers a host of services tailored to employees in the workplace. These include defined benefits, healthcare and stock plan services.

WHAT IS FIDELITY DIGITAL ASSETS?

Instead of using one of its pre-existing business arms, Fidelity Investments has created a new one to oversee its cryptocurrency ventures. Although the firm has a solid reputation as one of the largest global asset managers, it has limited experience in handling cryptocurrency.

WHAT SERVICES WILL FIDELITY DIGITAL ASSETS OFFER?

According to the press release, Fidelity Digital Assets will offer custody services for assets like Bitcoin and Ethereum, Trade execution services and dedicated client services.

CUSTODY SERVICES FOR BITCOIN, ETHER AND OTHER DIGITAL ASSETS

This service is particularly aimed at giving investors a way to store their digital assets during and after a trade. 

TRADE EXECUTION SERVICES

For its trade execution process, Fidelity Digital Assets will use an internal crossing engine along with a smart order router.

DEDICATED CLIENT SERVICES

Fidelity will also have a dedicated client services team to handle the onboarding process for its clients.

WHAT COULD THIS MEAN FOR THE FUTURE OF CRYPTOCURRENCY?

The adoption of cryptocurrency by Fidelity Investments speaks to a larger effort by big players to boost adoption in the space while satisfying the needs of their customers.

FINAL THOUGHTS

Fidelity Investments continues to pave the way for other smaller asset management firms and large corporations alike.