According to a press release published on 15th Oct 2018, the U.S. based Fidelity Investments that provides financial services and administers over 7.2 trillion in client assets, introduced a new company in the market focusing institutional clients called Fidelity Digital Assets. This is different from publicly traded blockchain stocks, and involves the actual trading of cryptographic digital assets.
Fidelity’s asset manager said that the new company will help the clients to store and trade various digital assets such as Bitcoins, Ethereum in a secure, compliant, and institutional-grade omnibus storage solution specially designed by the company. The new company will primarily target institutional investors like “family offices, hedge funds and market intermediaries” to offer them custody and trade execution services for Fidelity digital assets. As of now, all the similar services will not be enjoyed by retail investors, according to the press release.
The head of the newly-created business ‘Tom Jessop’ once quoted that “several years ago” Fidelity began exploring blockchain and crypto. And now in an interview with CNBC on Monday, Jessop mentioned that in the mid-2017 the idea of commercializing a “standalone” crypto firm initially began.
According to a report it is found that about 70% of the institutional finance executives believe that in financial sector crypto will have a specific role, despite the positives, there are still many on the sidelines who oppose crypto.
Abigail P. Johnson the Chairman, and CEO of Fidelity Investments mentioned:
“Our goal is to make digitally-native assets, such as Bitcoin, more accessible to investors.”
He further added “their company expects to continue investing and experimenting, over the long-term, with ways to make this emerging asset class easier for our clients to understand and use.”
All the resources of the big organization will be leveraged by the newly created company, Jessop told to CNBC. Further to bring the actors into the emerging space, Fidelity has already worked with over 13,000” institutional clients.
Jessop also states that the newly created company will make use of technological solutions that have been repurposed from different parts of their organization. The press release for crypto trades suggests that for the trading of digital assets the firm will make use of a proven internal crossing engine and smart order router. This will allow direct execution of a trade at multiple market venues.
Fidelity commitment towards digital assets is what makes the company different from other companies offering the trade of digital assets. Founded more than 70 years ago, the investment giant has been the leader in adopting new technology and offering new services and products benefiting their customers.
Their agenda has been quite simple as it believes that new business models can be achieved with the distributed ledger technologies. Apart from this it can also improve the existing financial market infrastructure, and lead to the creation of frictionless capital markets. With the type of efforts Fidelity is putting in, it can lead to the creation of a world where different types of assets can be represented or issued natively on a blockchain in a tokenized format.