Fidelity’s strategy to corner the cryptocurrency market appears to be more ambitious than previously thought, as asset management seeks to expand institutional access to digital assets.
Chrstine Sandler, the head of sales and marketing for Fidelity Digital Assets, claimed institutional interest in crypto is expanding in a recent interview with the Boston Globe.
Bitcoin (BTC) and, to a lesser extent, Ether (ETH) has been the key entrance points into crypto for most investors (ETH).
The pandemic, according to Tom Jessop, CEO of Fidelity Digital Assets, was a key impetus for investors to finally go into crypto:
“What got people off the fence was the pandemic because you have this rare asset class — there will only ever be 21 million bitcoin created — and a situation where our currency is being debased and there is a lot of money printing.”
It’s no secret that most institutional investors are cautiously investing in the cryptocurrency market this year for the first time.
Institutional investors are still primarily interested in buying Ethereum or Bitcoin directly. Fidelity Investments appears to be ahead of the game, seeking to be one of the first to provide the infrastructure needed for investors to gain direct access to the crypto market.
Fidelity filed the S-1 petition with the Securities and Exchange Commission in March of this year, formally seeking approval of their own Bitcoin ETF, Wise Origin Bitcoin Trust.
Fidelity bought a 7.4% investment in North American crypto miner Marathon Digital Holdings for $20 million at the end of July.
Fidelity has also established Devonshire Investors, a dedicated venture capital branch that invests in cryptocurrency firms such as ErisX, Talos, and Coin Metrics.
A growing demand from clients for crypto investment alternatives has fueled the company’s crypto ambitions. A similar pattern can be seen in big institutional funds and banks in the United States and around the world.
JPMorgan Chase & Co. is now allowing clients access to six crypto-dedicated funds, according to Cointelegraph. Firms including BlackRock, Goldman Sachs, and Citibank have voiced a more favourable stance on Bitcoin after first criticizing digital assets.
Meanwhile, according to a recent poll conducted by London-based crypto fund Nickel Digital Asset Management, the majority of wealth managers intend to increase their crypto exposure in the next years.
