Fidelity to launch Bitcoin retail trading in November

Fidelity Investment Managers will offer retail customers Bitcoin trading from November, according to Eight founder Michaël van de Poppe.

The firm is among the most significant investment managers in the U.S., with $4.3 trillion in assets under management as of March 31.

Commenting on what this means for the sector, van de Poppe said

“The adoption grows and it accelerates.”

Fidelity bets big with Bitcoin

Spurred by the burgeoning interest in Bitcoin, Fidelity launched its subsidiary business Fidelity Digital Assets (FDA), in October 2018, which caters to the growing institutional client demand for cryptocurrencies.

“Our continued research drives our belief that bitcoin is more than an asset; it represents the foundation of our business and a new financial system.”

FDA received a charter under New York banking law in 2019 and launched in Europe a year after receiving the charter to meet the rising global demand for digital assets.

The company offers its institutional clients a full suite of solutions, including cold storage custody, trade execution, and settlement services.

What’s more, while U.S. spot Bitcoin Exchange Traded Funds (ETFs) are continually delayed or rejected by the SEC, Fidelity launched its Physical Bitcoin Exchange Traded Product (ETP) in February, giving European professional investors exposure to the BTC price.

According to Morningstar, the terms ETP and ETF are used interchangeably. Like ETFs, ETPs are open-ended investments listed on exchanges, traded, and settled like shares.

“the general tendency both in the marketplace and the media is to use ETF and ETP as perfectly interchangeable terms.”

Not everyone is convinced

Fidelity announced plans to allow its clients the option to invest in Bitcoin as part of their retirement saving plan in April.

Under the scheme, retirement savers could add a maximum of 20% of their portfolio to BTC, with the employer able to reduce this cap if deemed necessary.

The pushback began with the U.S. Labour Department’s concerns about greenlighting the product. A report on the matter drew attention to the “significant risks” involved.

“These investments present significant risks and challenges to participants’ retirement accounts, including significant risks of fraud, theft, and loss.”

More recently, U.S. Senators Elizabeth Warren, Richard Durbin, and Tina Smith further raised issues with the matter in an open letter to the Fidelity CEO.

They said Bitcoin is “a volatile, illiquid, and speculative asset” unsuitable for retirement products.