Fidelity Investments is about to launch a cryptocurrency trading service aimed at retail investors.
report it CNBC He revealed that the company opened yesterday morning registrations on the waiting list to access the service.
On its official website, Fidelity already hosts a commission-free trading platform on stocks, options, ETFs, mutual funds, CDs, IPOs, and precious metals. Cryptocurrencies will soon be added to these assets.
The site also hosts a encryption sectionwhere it is possible to register on the waiting list for cryptocurrency trading.
In this section we read that only at first it will be possible to exchange Bitcoin and Ethereum, without having to worry about token management.
So it will probably not be an exchange with deposit and withdrawal functions, but just adding crypto assets to the ones already on their trading platform.
Fidelity Crypto is offered by Fidelity Digital Assets, a subsidiary of Fidelity Investments dedicated to cryptocurrency and digital assets. In addition, the service also offers a Crypto Helpdesk, that is, a virtual support that is always active to answer user questions.
Crypto fidelity and trading for retail clients
Fidelity Crypto allows you to buy and sell Bitcoins And the Ethereum Inside the Fidelity Investments app, with its custody service Fidelity digital assets.
On the site they make sure to make that clear Fidelity Crypto is neither a cryptocurrency nor a token, But it is just an additional service integrated into the company’s general trading application.
The fact that the service is specifically aimed at retail investors, and therefore not professionals, is evident from the fact that an always active Crypto helpdesk is provided which provides quick answers. This means that many simple questions are expected to be answered.
In addition, they have also started a subreddit and a channel on Discord.
The service will initially only be active in the USA, and will initially only allow the exchange of BTC and ETH. However, they mentioned that other cryptocurrencies are already being evaluated to expand trading opportunities over time.
They also claim that cryptocurrency deposits and withdrawals will not be possible within their app at this time, but they are already working on new features.
Fidelity Investments and its new cryptocurrency trading service
Fidelity Investments is an American multinational financial services company headquartered in Boston. It was founded in 1946 and is now one of the largest asset managers in the world, with approximately $4.5 trillion in assets under management and 24 billion in turnover.
The group includes a brokerage firm, a full range of mutual funds, retirement services, wealth management, asset custody, life insurance, and advisory services.
It has also been providing encryption services for several years thanks to its subsidiary, Fidelity Digital Assets.
In general the group has more than 70,000 employees, It provides services not only to professionals in the financial sector but also to individuals.
In particular, many of their crypto services target private investors.
small investors
Once the vast majority of investments were made thanks to dedicated professional operators who also acted as intermediaries for end users.
Instead, since the inception of online trading platforms, many private, so-called retail investors have started investing in person, without intermediaries.
The generic term “retail” actually refers to retail sales to private citizens, that is, those aimed directly at the end consumer. In the financial field, it refers to those services provided directly to investors, or to those who can be defined as “end consumers” of financial products, and not to professionals or companies.
Fidelity has been around in the retail financial market for quite some time thanks in particular to its pension services, which specifically target the end consumer of this type of financial product. So it is no coincidence that it has long ago begun to provide commercial services to these clients.
According to some estimates, in 2020 there are about 100 million retail investors in cryptocurrency markets around the world, and in 2021 they are likely to increase or double.
So it’s legitimate to imagine that among Fidelity’s retail clients there are plenty who are interested, in absolute terms, in investing in cryptocurrencies.
Bitcoin (BTC) and Ethereum (ETH)
The reason Fidelity has decided at this time to make the Trade Bitcoin and Ethereum It seems to be related to the solidity and reputation of these two cryptocurrencies.
It should always be kept in mind that Fidelity is a solid, traditional and unified brand. He certainly cannot expose himself to excessive risks, because many of his clients are not aggressive traders who are accustomed to taking risks and losing, but retirees who manage their assets prudently and prudently.
Because of this, it is possible that during the current bear market, the percentage of assets they will allocate to cryptocurrency investments will definitely be low.
Currently, Bitcoin and Ethereum are the only cryptocurrencies, apart from stablecoins, that seem to be able to offer a minimum level of security. In fact, there will also be BNB, because it is backed by the world’s largest crypto exchange (Binance), but Binance remains an important entrepreneurial risk activity, and this also increases the risk level of BNB. It is also, in fact, a competitor to Fidelity’s own cryptocurrency trading platform.
Perhaps only XRP can be included in a list of cryptocurrencies with requirements that it be included in Fidelity’s implementation, but only if Ripple wins the case against the SEC.
However, this scenario may change in the future, if other cryptocurrencies can show signs of solidity similar to those already widely offered by BTC and ETH over the years.
However, it should be remembered that Bitcoin and Ethereum are highly volatile cryptocurrencies, which is actually why they are attracting interest.
motives
A Fidelity spokesperson responded to a CNBC interview about the new cryptocurrency trading service by saying:
“Where our customers invest matters more than ever. A significant portion of Fidelity’s customers already care about and own cryptocurrency. We provide them with the tools to support their choice, so they can benefit from Fidelity’s knowledge, research and technology.”
So the motive for the new service is trivial: to offer its customers a service they could previously only find elsewhere, and which many may already be using.
As is often the case, it is the customers themselves who move faster and earlier, while large companies develop more slowly.
Suffice it to say that the world’s largest cryptocurrency exchange (Binance) was born out of nowhere just five years ago, as a private initiative by a group of entrepreneurs, investors and developers. Even the other major giant in the sector, Coinbase, was born this way, that is, out of nowhere.
The big names that have been in the financial sector for decades all arrived later, precisely because they were too big to be able to develop so quickly.
However, now that their clients have moved a portion of their capital into the crypto markets, they are forced to run for cover and quickly do what they have not wanted to do in recent years.