Financial services giant Fidelity Investments is expected to launch Bitcoin trading services for institutional investors in the next few weeks. Upon launch, Fidelity will buy and sell Bitcoin on behalf of its customers. In an email to Bloomberg, Fidelity spokeswoman Arlene Roberts says,
“We currently have a select set of clients we’re supporting on our platform.”
“We will continue to roll out our services over the coming weeks and months based on our clients’ needs, jurisdictions, and other factors. Currently, our service offering is focused on Bitcoin.”
Fidelity is one of the largest asset managers in the world. In a new interview with Cointelegraph, senior market analyst for crypto trading platform eToro, Mati Greenspan, says that while Fidelity’s entrance into the space could boost the price of Bitcoin, it may take some time.
“It seems very positive from everything that I see. They’re certainly not the first institutional player to offer crypto for their clients but they are actually very likely to be the biggest.
What the demand from their clients is going to be we’ll have to wait and see, but I think that this is something that can move the liquidity of the entire market significantly forward.”
As for how much money could flow into the market, Greenspan says,
“Well, we can really only speculate on that. I know that they have upwards of a trillion dollars under management. Let’s say even 1% of that, if that goes into crypto, if all of their clients diversify with 1%, I think that that may be a bit aggressive to think about but if we think about it in those terms, that itself could drive the price of Bitcoin up $1,000, $2,000 easily.
The question though remains are they going to see that kind of demand. My feeling is it will take them a while to explain to their customers how this is beneficial for their portfolio. And then it will take a while before the crypto market looks attractive enough for those customers. It could all happen at once. It could happen over time. It’s worth keeping an eye on.”
As Bitcoin hovers just below $6,000 at an all-time high of $5,955 for 2019, its year-to-date return on investment at 53% has surpassed a number of traditional assets, including gold, tech stocks, real estate and global stocks.
Bitcoin versus Traditional Assets, YTD Returns
Fidelity has $2.6 trillion assets under management. It created Fidelity Digital Assets in October of 2018 to focus on the emerging asset class.
Although the company has not disclosed the number of clients who are already invested in crypto, Tom Jessop, president of Fidelity Digital Assets, says,
“We’ve seen a maturation of interest in digital assets from early adopters, like crypto hedge funds, to traditional investors like family offices and endowments.”
Last week, a survey by Fidelity showed that 22% of institutional investors already have some exposure to digital assets. Nearly half of institutional investors see a place for digital assets in their portfolios.
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