Fidelity Investments Plans To Lift The Barrier To Institutional Crypto Investment

Fidelity Digital Asset Services, LLC announced the launch of a new platform on Monday during Bloomberg’s Institutional Crypto event.

The firm wants to provide cryptocurrency custody and trading services for enterprise clients and has appointed Tom Jessup, to head the new division whose target will be to lure hedge funds, family offices, and market intermediaries to cryptocurrencies.

The new head of division shared insights into how the firm plans to remove a barrier which has stopped institutional investors from getting involved with cryptocurrencies.

Aligning Itself With Institutional Investors

Remarkably, Fidelity Digital Asset Services, LLC is one of the five largest financial service providers in the world, managing around $7.2 trillion in clients assets.

A famous status among the traditional finance market means that Fidelity Investments already has ties with many institutional investors using its services.

With this in mind, Jessup revealed that they have held “conversations with institutions” who confirmed to them that in order to engage with digital assets in a meaningful way, they need a trusted platform provider to enter this space.

Fidelity says it will now aim to provide this “trusted platform” by first starting out with “institutional-grade custody, trade execution, and dedicated clients service.

The long term goal will be to create a full-service enterprise-grade platform for digital assets.

“These institutions require a sophisticated level of service and security, equal to the experience they’re used to when trading stocks or bonds.”

With support from other institutions in the traditional finance space, there is a big chance that Fidelity Investments will succeed in bridging the gap between the old and new money markets.

A Big Five Seeking Crypto Industry Prominence

Only a few traditional asset management firms match Fidelity Investments when it comes to providing world-class service.

According to Jessup, ‘Those efforts have been successful in helping them understand and advance their thinking around cryptocurrencies.”

It is merely a case of putting experience gathered from managing traditional financial assets, to use in a different industry.

Judging by the signs, the firm is already gearing up to the new adventure. It has revealed that it provide custody for bitcoin, ethereum, and other yet-to-be-named cryptocurrencies at launch.

In addition to that, Fidelity says it will hold the cryptocurrencies in cold storage along with multi-level physical and cyber controls.

The ultimate goal as asserted by Abigail Johnson CEO and chairman of Fidelity Investments is to make digitally-native assets, such as BTC more accessible to investors, according to the release.

Rounding Up

If Fidelity Investment achieves its goal of lifting the barrier to institutional crypto investments, then the crypto markets will be the biggest beneficiaries.

A lot of new institutional investors can easily sign up to and trade cryptocurrencies through the new products and services to be rolled out by the firm.

It may be too early to speculate though, so we’ll simply cross our fingers and hope it plays out well. 

What are your thoughts? Leave your comments below.

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