Billionaire Mike Novogratz’ Crypto Fund is Fidelity’s First Custodian Client

Billionaire Mike Novogratz’ Crypto Fund is Fidelity’s First Custodian Client

Crypto merchant bank ‘Galaxy Digital‘ being listed on the Toronto-based stock exchange as TSX-V and operated by billionaire investor Mike Novogratz has turned out to be the primary alpha crypto custody client of Fidelity Digital Assets, as reported by CCN. Fidelity Digital Assets is a subsidiary of Fidelity and was launched this week. Fidelity is the fourth-largest asset manager with $7.2 trillion worth of assets as of October 2018 administration.

Fidelity through its subsidiary will offer infrastructure and services to its 27 million customers as well as 23,000 businesses willing to invest in the crypto market. Abigail Johnson, Fidelity CEO, believes that the subsidiary will have to fulfill the requirement of the crypt sector in the long run by enhancing accessibility and infrastructure of the asset class, according to a press release.

Johnson said that the goal is to allow investors to gain access to digitally-native assets like Bitcoin. The company is already in the process of making these assets accessible to its customers and investors and will continue to find better ways in the future as well, said Johnson. Fidelity Digital Assets as its primary service provide institutional investors like hedge funds and other financial as well as academic institutions assistance in investing in the crypto market with products that are institutional dedicated products.

Commenting on the creation of the asset arm by Fidelity Tom Jessop, founding head at Fidelity Digital Assets, said that the asset arm hints at Fidelity understanding of cryptocurrency demand from institutions. It was not even 24 hours of its launch that Galaxy Digital was secured as Fidelity Digital Assets’ first custody client. Galaxy Digital aims at similar goals to institutionalize the crypto market.

The development hints at the growing demand of these assets as a class from institutions said, Jessop. He further added that institutions like hedge funds, family offices, and other investors are said to be taking these assets quite seriously.

Mike Novogratz reportedly invested $302 million in the Galaxy Digital in January 2018 in an initiative to create a full-service merchant banking firm in the blockchain and crypto market. A few months later, Galaxy Digital allowed investors to invest directly to the firm as it got itself listed on Canada’s stock market. Galaxy Digital also provides consultancy services to top notch investors and institutional clients enabling them to make huge investments into the crypto market.

The newly formed asset arm will have more than 70 employees coming from various fields of expertise that will include technology, trading, advisor, and investing. Jessop informed that the company has already invested in its various department via management, legal, finance, and operations. Clients of the Novogratz-led firm will be able to invest in the crypto market as a result of Fidelity and Galaxy Digital partnership. The investment, however, will be done through Fidelity. The process of investment will remain unchanged as it was before the launch of Fidelity asset arm.