Fidelity Investments has quietly opened access to bitcoin and ether trading to all of its retail traders, filling a void created by the closings in recent days of cryptocurrency-friendly banks that have bridged the gap between digital finance and traditional.
The Fidelity Crypto platform, previously only available to institutions and select waitlisted customers, was made available earlier this month. Individual investors can now buy and sell bitcoin and ether and use custody and trading services provided by Fidelity Digital Assets.
Customers are not yet able to transfer cryptocurrency to or from their Fidelity accounts. The company said it would explore cryptocurrency transfers in November, shortly after the waitlist was announced, but did not provide a clear timeline.
Investors’ separation of passwords known as private keys that allow direct owners to take custody of their cryptocurrencies, combined with the inability to transfer holdings, means that Fidelity retains custody of the assets. A string of bankruptcies among crypto exchanges and investment schemes last year illustrated the downsides of entrusting digital assets to intermediaries, though Fidelity’s size and reputation likely mitigate the risk.
The company did not respond to a Forbes request more information.
Trading is only open to US citizens over the age of 18 who reside in one of the 36 states where Fidelity Digital Assets offers services.
Following in the footsteps of stock trading app Robinhood and crypto exchange Binance.US, the asset manager touted the offer as commission-free, but there’s a catch: a $1 fee. % will be added to each transaction. The company calls the fee a spread and defines it as “the difference between your execution price and the price at which Fidelity Digital Assets executes your order.”
The move comes at a time when the U.S. cryptocurrency market is facing regulatory pressure, triggered by multiple high-profile meltdowns over the past year and shutdowns of crypto-friendly banks, including Silicon Valley Bank, Silvergate and Signature.
Still, the Fidelity service “provides both the credibility crypto needed and the opportunity for investors, most of whom rely on their financial advisers for investment strategies,” says Ric Edelman, financial adviser and founder of the Digital Assets Council of Financial Professionals.
In addition to cryptocurrency trading, Fidelity also offers the Fidelity Ethereum Index Fund, which tracks the performance of the coin in US dollars. In December, the asset manager filed three trademark applications to provide NFT and metaverse investment services.