Fidelity Doesn’t Want Retail Investors Making Mistakes With Bitcoin
Last year, financial services behemoth Fidelity Investments made a massive splash in the Bitcoin scene when it revealed that it had launched a cryptocurrency-centric branch, Fidelity Digital Asset Services (FDAS).
The idea with FDAS was that institutional investors could gain access to high-quality custodial and trading services, likely providing the Bitcoin market with a boost in liquidity and overall traction. So far, FDAS has purportedly only been servicing a small set of institutional clients, keeping this project in a beta-esque phase.
But naturally, many have asked when Fidelity — a firm with literal trillions of dollars under management — will begin to provide cryptocurrency services to its retail clients. These inquiries recently got a response, in the form of a statement that cryptocurrencies are extremely risky.
Bitcoin & Crypto Not Entirely Retail-Ready
Kathleen Murphy, the personal investing president of Fidelity, argued in an interview with CNBC that cryptocurrencies aren’t ready for consumption by the widespread retail audience just yet, at least through Fidelity’s product roster. She said that while the firm “embrace[s] crypto in terms of trying to understand it and be innovative and thoughtful [as a company], we are very careful about where we offer [cryptocurrencies], so that’s not offered broadly on our retail platform.”
Murphy added that Fidelity wants to make sure that retail investors, or those “investors who really aren’t institutional investors,” don’t make a mistake with cryptocurrency.
Indeed, cryptocurrencies have been proven to be very volatile over the years, trading in seeming unpredictable trends and acting as a catalyst for large wealth creation and dissipation over the past decade.
Not All Is Lost
While Fidelity’s seeming assertion that it won’t be offering Bitcoin-related services and investment opportunities to its retail clientele any time soon might be worrying, not all is lost.
There are, of course, multiple other platforms from mainstream institutions that allow for retail investors — which may end up being the demographic driving the largely anti-establishment crypto revolution — to gain exposure to Bitcoin and its ilk.
As reported by Blockonomi previously, San Francisco-based financial services upstart Social Finance (SoFi) announced last month that it has rolled out cryptocurrency investing for its SoFi Invest application. SoFi Invest now supports Bitcoin, Ethereum, and Litecoin trading for its hundreds of thousands of clients. The upstart joins Robinhood and Cash App — two of the biggest fintech startups in the United States — in offering easily-accessible and simple cryptocurrency trading to retail clients.
There have also been developments across the pond. Boerse Stuttgart, Germany’s second-largest stock exchange, opened a cryptocurrency trading platform in late-September.
The exchange’s CEO, Dr. Dirk Sturz, has said that he believes that blockchain-based assets will continue to be a growing market, hence the need for this new platform, Boerse Stuttgart Digital Exchange. The new platform will soon service institutional and retail clients all across the European Union.
Social media giant LINE has begun operating a cryptocurrency exchange dubbed BITMAX in Japan. LINE has over 80 million users in Japan, who will now be able to use the exchange to purchase Bitcoin amongst other digital assets.
Similarly, Rakuten, Japan’s own version of Amazon, has just released a cryptocurrency trading application. Industry analyst Joseph Young remarked that with 1.2 billion customers, the new Rakuten Wallet exchange could be a massive catalyst for the industry’s growth in the years to come.
But the best may be yet to come.
TD Ameritrade, one of the largest retail brokerages in the U.S., is soon expected to offer spot cryptocurrency trading, opening up a whole new market to Bitcoin.
Whether all the abovementioned translates to larger investment inflows remains to be seen, however.
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