Fidelity launches Bitcoin retail in November
Fidelity Investment Managers will offer retail Bitcoin trading from November, according to Eight founder Michael van de Poppe.
The firm is among the most significant investment managers in the United States, with $4.3 trillion in assets under management as of March 31.
Commenting on what this means for the sector, van de Poppe said
“Adoption is growing and accelerating.”
Fidelity bets big with Bitcoin
Spurred by the growing interest in Bitcoin, Fidelity launched its subsidiary Fidelity Digital Assets (FDA), in October 2018, which caters to the growing institutional demand for cryptocurrencies.
“Our continued research drives our belief that bitcoin is more than a resource; it represents the foundation of our business and a new financial system.”
The FDA received a charter under New York’s banking law in 2019 and launched in Europe a year after receiving the charter to meet the growing global demand for digital assets.
The company offers its institutional clients a complete suite of solutions, including cold storage, trade execution and settlement services.
Also, while US spot Bitcoin Exchange Traded Funds (ETFs) are continually delayed or rejected by the SEC, Fidelity launched its Physical Bitcoin Exchange Traded Product (ETP) in February, giving European professional investors exposure to the BTC price.
According to Morningstar, the terms ETP and ETF are used interchangeably. Like ETFs, ETPs are open-end investments listed on exchanges, traded and settled like stocks.
“the general tendency in both the market and the media is to use ETF and ETP as perfectly interchangeable terms.”
Not everyone is convinced
Fidelity announced plans to offer clients the option to invest in Bitcoin as part of its retirement savings plan in April.
Under the scheme, pension savers could add a maximum of 20% of their portfolio to BTC, with the employer able to reduce this limit if deemed necessary.
The backlash began with the US Department of Labor’s concerns about greenlighting the product. A report on the case drew attention to the “significant risks” involved.
“These investments pose significant risks and challenges to participants’ retirement accounts, including significant risk of fraud, theft and loss.”
Later, US Senators Elizabeth Warren, Richard Durbin and Tina Smith took further questions about the matter in an open letter to the Fidelity CEO.
They said Bitcoin is “a volatile, illiquid and speculative asset” unsuitable for pension products.
