Some custodial platforms aren’t yet deep into the cryptocurrency, but one of the pioneers in this realm is also one of the largest and most familiar names to advisors: Fidelity.
In 2014, Fidelity started mining bitcoin. That was just a few years after what’s now the largest digital asset was born. Four years later, the firm launched Fidelity Digital Assets, “an institutional custody and trading platform for digital assets.”
Now, the firm is upping the ante with Fidelity Crypto for Wealth Managers, which will reside in Wealthscape – the platform with which advisors custodying with Fidelity are intimately familiar. This continues a burgeoning legacy of crypto evolution at Fidelity.
Fidelity dipped its toes into the crypto-correlated equities side of the equation, introducing the Fidelity Crypto Industry and Digital Payments ETF (FDIG) and the Fidelity Metaverse ETF (FMET). Those ETF launches further affirm Fidelity’s commitment to digital assets – a relevant point for the myriad doubting Thomases surrounding this asset class.
Last year, the firm introduced its workplace Digital Assets Account, which allows 401(k) participants to direct some of those retirement dollars to bitcoin and the like.
Why Fidelity Crypto for Wealth Managers Matters
Indeed, the timing of Fidelity Crypto for Wealth Managers is interesting. The offering arrives as bitcoin is rallying amid speculation that Fidelity rival BlackRock is looking to list a spot bitcoin exchange traded fund, which has encouraged rival issuers, including Fideltiy to renew applications for related ETFs.
The prevailing wisdom holds that BlackRock is so well-connected in Washinton, D.C. that it wouldn’t be bothering with a bitcoin ETF application if it didn’t believe the venture would be approved by regulators. It remains to be seen if the Securities and Exchange Commission (SEC) finally comes around on spot bitcoin ETFs, but the fact remains advisors desire such products.
Even if such an ETF doesn’t come to life, Fidelity Crypto for Wealth Managers helps advisors make strides with this asset, leveraging access and technology at a time when crypto-enthused clients are demanding more of both.
Within the platform, Fidelity is promising real-time trade settlement along with “immediate access to client funds.” Additionally, the firm is offering advisors 20-hour crypto trading windows every day of the week, no account minimums and “integrated cross asset-class reporting with third party data vendors.”
Fidelity is also positioning advisors to source crypto liquidity from multiple platforms without having to leave the Wealthstation platform.
“It's unclear what venues the service will access for liquidity, yet one may be EDX Markets, in which Fidelity itself has an investment, alongside rival brokerage firm and RIA custodian Charles Schwab Corp., Citadel and others,” according to WealthManagement.com.
Move Could Pay Dividends for Fidelity Advisors
Understandably, there’s long-running debate regarding how much of a client’s portfolio should be allocated to crypto, if any at all. There’s also debate surrounding whether or not an advisor should even be advocating crypto to clients.
Those are arguments for another day. What cannot be debated is that a broad swath of clients – baby boomers, women, millennials and more – are interested in crypto.
That could be confirmation that Fidelity Crypto for Wealth Managers gives Fidelity advisors a leg up on rivals and that the competition could later follow suit.
Related: Blockchain Separates From Crypto