Fidelity has now cemented it’s place as a key player in the world of cryptocurrencies by initiating a new crypto custody service. According to Fidelity CEO, Abigail Johnson, there is a noticeable lack of large, well-established and trusted financial/investment firms in the crypto game. What the industry needs, in Johnson’s opinion is a regulated player that investors can count on.
Last fall, we first heard of Fidelity’s plans to enter the crypto game when an announcement was made assuring the group’s investors that they would soon have access to cryptocurrency investment options. For an investment firm worth upwards of 3 trillion dollars, that commitment was a serious one indeed.
Fidelity in full swing
The strength Fidelity brings to the table is apparent in how quickly the rollout has commenced. In just a few short months, the firm has gone from a few initial accounts to a full-scale roll out.
In an interview, Ms Johnson says that Fidelity offers much of it’s success to the fact that they are, as of now, one of the only real options for crypto investments. Especially for those used to utilizing investment firms and Banks to handle the difficult sides of investment strategies.
She added that another notable benefit to using a trusted investment firm for cryptocurrency investment is the handling of crypto assets after death. According to Johnson, there are enormous amounts of wealth lost as a result of the holder passing. Oftentimes, keys and signatures are non-transferrable, and many people would like to see a different reality.
Next steps for Fidelity and cryptocurrency
While Fidelity’s new move into the crypto world does promise to bring a new degree of validation to block chain currencies which should usher in new levels of crypto use, the investment firm is now seeking to offer services on an even larger scale.
Fidelity has recently applied to the New York State Department to act as a trust company for other financial organizations. Upon approval of their application, Fidelity will be able to widen it’s scope to include Banks and investment firms, thus bringing crypto investment to completely new levels within the mainstream.
Custody decision not taken lightly
Providing custody services is not the only venture that Fidelity has been interested in. Going back as far as 2014, the company has been experimenting with different ways to get involved in the world of block chain. One of the first ventures was Bitcoin mining, an experiment that costed the company nearly $200,000.
While many other players in the investments industry questioned Fidelity’s large foray into block chain, it is now very clear why Fidelity invested the time and energy they did: they are trying to be one of the primary investment firms responsible for bringing cryptocurrencies into a new age.
As you can see, the custody decision was not taken lightly. While many other projects could have been possible for Fidelity, the company’s pre-established infrastructure, as well as the customer demand, made moving into custodial services a no-brainer.
If there’s one thing that we like to keep our eyes on is how the cryptocurrency industry is moving into the future. The potential for systemic change that Fidelity’s new custody services could very well initiate. Fidelity will not have an effect on the block chain on the whole, but the company will very likely change public opinion about cryptocurrencies, create greater levels of trust in blockchain technologies, and, as a result, push value upwards.