Fidelity Investments has announced at an event in Bloomberg’s New York City headquarters, that it is launching a new company focused on Cryptocurrencies called ‘Fidelity Digital Assets’, to Provide Enterprise-Grade Digital Asset Solutions for Institutional Investors.
Fidelity provide financial services including clearing, custody and investment for 13,000 institutional advisory firms and brokers and holds $7.2 Trillion in customer assets, making them the 5th largest asset manager in the world. The introduction of Fidelity Digital Assets bridges the gap in support for institutions which has been lacking, despite increasing amounts of retail service providers entering the space.
Greenwich Associates conducted research suggesting that 70% of institutional finance executives believe cryptocurrencies will have a place in the future of the industry, however many firms are waiting on the sidelines to enter the market. Fidelity hope their FDA platform will make that process easier for investors.
“Our goal is to make digitally-native assets, such as bitcoin, more accessible to investors”
“We expect to continueinvesting and experimenting, over the long-term, with ways to make this emerging asset classeasier for our clients to understand and use.”
- Abigail P. Johnson, Chairman and CEO of Fidelity Investments.
Further Research carried out by fidelity suggest a number of key reasons why institutional investors are looking to enter into the cryptocurrency market, be it as a store of value, a hedge against other assets or even the potential to serve as lower cost global payments that they believe can power new industries and innovation not yet seen.
As for what will be listed on the FDA, It is not yet clear beyond their vague statement of, “Bitcoin and other digital assets”, although judging by the market and what other major exchanges agree should be listed it may not be a stretch to assume Ethereum and Litecoin would be on that list.
“In our conversations with institutions, they tell us that in order to engage with digitalassets in a meaningful way, they need a trusted platform provider to enter this space. These institutions require a sophisticated level of service and security, equal to the experience they’re used to when trading stocks or bonds.
What is very interesting with Fidelity is the depth into which they have studied Digital Money and the understanding they display which makes it clear that the move is more than just an opportunistic chance to benefit from hype and speculation in the space and that they understand the technology to properly handle and manage it. Fidelity have even written an article on the history of Digital Money referencing the pioneers in the space, David Chaum, Adam Back, Wei Dai, Nick Szabo and Hal Finney
“We started exploring blockchain and digital assets several years ago, and those efforts have been successful in helping us understand and advance our thinking aroundcryptocurrencies,”
“The creation of Fidelity Digital Assets is the first step in a long-term vision to create a full-service enterprise-grade platform for digital assets.”
- Tom Jessop, head of Fidelity Digital Assets.
Fidelity are not new to Cryptocurrency by any means and appear to be very much at the forefront when it comes to this technology, perhaphs then it is no surprise the announcement has come just a few weeks after ‘Bakkt’ the new Insitiutional digital assets platform from ICE Markets, owners of the NYSE.