Fidelity Investments has announced the launch of its cryptocurrency custody service.
In a recent interview with the Financial Times, Fidelity CEO Abigail Johnson stated the firm is launching its cryptocurrency custody firm after a year-long accumulation of clients.
Last fall, Fidelity hinted at an enterprise-level cryptocurrency custody service for financial advisors and hedge funds.
At the time, Johnson stated the sector lacked development, but did see the potential, saying:
“There are people out there with significant amounts of wealth in cryptocurrencies, probably Bitcoin, and they’re looking for somebody to hold those coins for them because in the event of their passing — which is going to happen at some point or another — you’ve got to have a plan to be able to get those coins to somebody else.”
Cryptocurrency startup Coinbase launched its custody product, Coinbase Custody, in July 2018 to provide enhanced security, something Coinbase says has been institutional investors’ “number one concern.”
In August, Coinbase Custody announced they have stored assets on behalf of more than 120 clients residing in 14 different countries.
Personal Investing President of Fidelity, Kathleen Murphy, stated the company will not offer exposure to cryptocurrencies on its retail trading platforms.
“You know, we’re really careful about that,” Murphy stated.
“So while we embrace crypto in terms of trying to understand it and be innovative and thoughtful, we’re also very careful about where we offer those types of things, so they’re not offered broadly on the retail platform. We want to be very careful about making sure that investors who really aren’t institutional investors […] don’t make a mistake with cryptocurrency.”