Fidelity Digital Assets to launch its Bitcoin Custody Service
A recent report has revealed that Fidelity Digital Assets plans to launch its own Bitcoin Custody Service, a move which is expected to remove one of the final blockage hindering institutions from investing in Bitcoin.
Fidelity Investments is the Fourth Largest Asset Manager in the World
According to a recent report, the fourth largest asset manager in the world, Fidelity Investments announced its cryptocurrency ambitions and digital offshoot. Further reports have also revealed that the exchange will be placing its focus on custodial services rather than exchange services. This led to the parent company- Fidelity Investments, investing a multi-million dollar in a new crypto-exchange.
The first product-a Bitcoin Custody is set to be launched in March and Ether custody is reportedly expected to be the next product to be launched.
Although custody services are commonplace for financial investments, they have not been able to achieve a solid ground in the world of Bitcoin $3498.54+0.07%.
How Bitcoin Custody Works
It works by handing over the guardianship of the securities to a trusted third-party who then keeps them in a secure facility thereby leaving both the investor and the broker free from having to bear the responsibility for the asset. This tops Bitcoin’s slogan which states that “not your keys, not your coins” even though traditional investors might find this more appealing for delving into cryptocurrency. It also reduces the risk of loss or theft.
The Need for Tested and Trusted Custodial Services
Also, even though several companies such as Coinbase have tried to be the ones providing custodial services for virtual currency, it seems as though institutional investors have been waiting an established asset-management company like Fidelity.
Fidelity Investments’ Chief Executive Officer, Abigail Johnson directed the exchange to start mining bitcoin in 2015 and is also the one that led the push in this new direction.
According to a recent report, the company said: “We are currently serving a select set of eligible clients as we continue to build our initial solutions. Over the next several months, we will thoughtfully engage with and prioritize prospective clients based on needs, jurisdiction and other factors.”
