Fidelity and Schwab Reportedly Hire Market Makers for Crypto Trading Platform
Fidelity Investments provides financial planning, retirement planning, wealth management, and trading and brokerage services. Last week it was reported that the company plans to fill 210 new positions for its Fidelity Digital Assets division, signaling longer-term ambitions in the crypto space.
Charles Schwab (SCHW) is an American multinational financial services company, bank and securities broker with an electronic trading platform.
According to Barron’s, a Schwab spokeswoman confirmed the move into the crypto sector:
“Schwab has made a minority passive strategic investment in a new digital asset venture. We know there is considerable interest in this cryptocurrency space, and we will seek to invest in companies and technologies working to deliver a access with a strong regulatory orientation and in a secure environment.
A Fidelity spokesperson added, “Fidelity supports efforts that make the digital asset market more efficient and provide more options for providing liquidity to investors.”
This decision could be a big step towards integrating more institutional and longer-term investors. Current options are limited to crypto exchanges which require some technical knowledge to use, and platforms such as PayPal (PYPL), which recently enabled crypto withdrawals, or Robinhood (HOOD)
It could be that these large institutional players view the current bear market as a buying opportunity. Crypto markets have gone through several boom-bust cycles like this over the past decade.
However, Schwab said it has no plans to offer direct crypto trading due to regulatory uncertainty in the United States. The spokesperson continued:
“We recognize that there is considerable interest in cryptocurrencies, particularly in certain market segments, and will consider introducing direct access to cryptocurrencies when regulations become clearer,”
Fidelity does not yet offer direct crypto trading either. Its clients can gain exposure to digital assets through thematic exchange-traded funds. It also announced plans to provide access to Bitcoin (BTC) in its 401(k) plans, a move that caught the attention of US policymakers.