Fidelity Digital Targets Retail Consumers with ‘Commission-Free’ Crypto Trading

Fidelity is bringing crypto to retail investors as it opens a waiting list for Fidelity Crypto, a trading platform that will offer custodial and trading services and allow investors to buy and sell Bitcoin and Ethereum. The platform hasn’t officially launched yet, nor has Fidelity announced a launch date; but with the waiting list open for pre-registration, it is clear that the release date might just be around the corner. Fidelity also says it will offer commission-free trading to retail investors.

Fidelity is one of the largest brokerage and asset management firms in the world, managing up to $9.9 trillion in assets.

Fidelity’s Foray Into Crypto

Fidelity began researching Bitcoin and blockchain technology in 2014. Fidelity created its institutionally-focused digital asset unit Fidelity Digital Assets in 2018. With the creation of the new unit, Fidelity entered into the digital currency space in a game-changing way. Fidelity says its digital assets unit’s main goal is to provide institutional investors with full-service digital assets investment solutions and to build products that will enable the broader adoption of digital assets.

Recent Crypto Expansion

So far, Fidelity has been involved in digital assets custodianship for its institutional clients by creating digital assets clearing and settlement services. Fidelity places clients’ assets in cold storage and settles transactions with periodic payments.

Crypto in 401(K)

Early this year, Fidelity announced that it would soon allow investors to add crypto assets – Bitcoin at first – to their 401(k) if their employer allows it. Fidelity holds over $2 trillion in retirement assets and administers the pension plans of over 23,000 companies in the US. Fidelity is the first retirement plan provider to consider adding Bitcoin to 401(k).

Wise Origin Bitcoin Index Fund

In April 2021, Fidelity launched the Wise Origin Bitcoin Index Fund I to provide high-net-worth investors with exposure to the performance of Bitcoin through a limited partnership and private placement structure. The fund allows high-net-worth individuals to get exposure to digital assets without the need to purchase digital assets directly or be involved in the intricacies of the safe storage of digital assets.

The first Bitcoin funding round announced in August 2020, accepted only investors who can invest a minimum initial amount of $100,000. Fidelity has also recently launched a second fund called the Fidelity Ethereum Index Fund. In the Ethereum fund, the minimum accepted investment was set at $50,000, according to a SEC filing. Fidelity raised over $5 million in less than a month of launching the Ethereum fund.

Attempts at ETF Approval

Fidelity has long sought the US Securities and Exchange Commission’s (SEC) approval for crypto-related exchange-traded funds (ETF). Fidelity tried to get approval for the Wise Origin Bitcoin ETF, which is a spot Bitcoin ETF; but the SEC rejected Fidelity's Application. Fidelity has, however, successfully launched a Bitcoin ETF in Canada.

In January this year, Fidelity applied for a Metaverse ETF. Fidelity has since launched the metaverse ETF. The Fidelity Metaverse ETF tracks the Fidelity Metaverse Index which tracks the performance of companies that develop, manufacture, or sell products and services related to the metaverse.

Hiring en Masse

To bolster its growing digital assets division, Fidelity recently announced it would hire an additional 100 people in a new hiring round. While crypto companies like Coinbase have been laying off staff, Fidelity is doing the opposite – hiring. The hiring of 100 new employees will increase its crypto unit workforce by 25%.

Moving Forward

Fidelity’s latest bold crypto moves, despite the crypto bear market, show that the gap between traditional and digital assets investment is closing. With the launch of commission-free trading platforms, like Fidelity Crypto, targeted at retail investors, existing US-based trading platforms such as Robinhood and Coinbase will now face tight competition from big institutional players.

To learn more about Bitcoin visit our Investing in Bitcoin guide.