- Fidelity Investments’ cryptocurrency arm has made its first push in Europe by launching a foray.
- Fidelity Digital Assets is working in collaboration with Nickel Digital Asset Management.
- Fidelity remains to see whether this alone will pave the way to an influx of mainstream investment into the crypto world.
The American multinational financial service corporation Fidelity Investments’ cryptocurrency arm has made its first push in Europe by launching a foray that expected to complement its efforts in bringing digital currency into mainstream financial investing.
Fidelity Digital Assets is working in collaboration with Nickel Digital Asset Management, where the financial giant will serve as a custodian for bitcoin held by the London based crypto investment firm. The announcement, which was a joint affair on Tuesday, was met with reasonable approval from the crypto community.
Large investors from around the globe have not actively engaged themselves with the highly volatile yet lucrative and emerging digital asset. The main reason for this lack of enthusiasm can be traced back to a lack of back-off services like custody offered by major financial firms.
But now that one of the world’s largest investment managers, Fidelity, which has more than $7.8 trillion under management, has taken that step, it remains to see whether this alone will pave the way to an influx of mainstream investment into the crypto world.
Further, significant pension funds and asset managers are still highly suspicious of digital currencies because of their regulation norms and reputation for hacks and crimes irrespective of the potential monetary gains it has to offer.
Bitcoin has been the most popular cryptocurrency, with its value doubled last year and exceeding expectations of emerging mainstream usage.
Still, large investors focus on market dysfunctionality and high unpredictability with double-digit price swings. Its opaque price discovery and inferior liquidity do not add to its cause.
Facebook launched Libra in its high – profile attempt to mainstream the usage of cryptocurrency. This move was met with considerable global criticism and resulted in France and Germany pledging to block the currency’s operations in Europe entirely.
Fidelity Digital Assets’ Europe head Chris Tyrer stated that hurdles like regulation issues or quality of service providers and even fear of high volatility were reducing among institutional investors, thus showing good signs for their participation in crypto markets.
Tyrer also said that his firm was noticing considerable interest from family offices and wealth managers along with crypto companies but declined to reveal the amount they manage or the number of clients they had.