Fidelity has secured Canada’s selection from regulators to become the country’s first-ever bitcoin custodian. This will enable the financial service firm to trade and custody bitcoins in Canada. It is a move geared toward institutional investors. This move may also allow more Canadian institutions and individuals to invest in cryptocurrency.
Fidelity to the First-Mover
Fidelity Clearing Canada (FCC), released Wednesday’s press release announcing the news. The release quickly notes that FCC is “Canada’s first Investment Industry Regulatory Organization of Canada (IIROC) regulated entity to offer this digital currency trading and custody solution dedicated for institutional investors, including mutual funds and exchange-traded funds.”
FCC President Scott Mackenzie stated in the release that “the demand for investing in digital assets is growing considerably and institutional investors have been looking for a regulated dealer platform to access this asset class.” This announcement opens that door for investors. Canadian investors have had to use mutual funds or ETFs to get crypto exposure. Additionally, Bitcoin funds in Canada are offered by U.S. custodians.
FCC manages over $200B worth of assets under management (AUM). Over 100 Canadian investment companies also have access to FCC’s services. Fidelity reports that it expects to have a four-year time frame for services in cryptocurrency markets, based upon the U.S. precedent. We don’t yet know the full extent and scope of these services.
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Fidelity’s Perspective
According to the financial services provider, crypto is a hot topic. At the very least, the firm recognizes the staying power and understands that it needs to carve out it’s role in crypto. Last month, a Fidelity analyst showed cautious optimism in bitcoin’s “diamond hand” owners. The analyst believed bitcoin was still far from $100,000, despite this. The analysts’ expectations seem to be about the same.
It was 2018 that Fidelity opened its first U.S.-based bitcoin services. By May of this year, Fidelity opened it’s first bitcoin fund in the U.S., raising over $100M from around 80 accredited investors.
Fidelity has also published their Fidelity Digital annual report in recent months. It contained a number of fascinating findings. Nine out of ten investors surveyed found digital assets attractive. With just the past few months of activity alone, it’s clear that Fidelity understands the importance of what’s at stake – and today’s announcement in Canada will position them quite well in the country to take advantage of that knowledge.
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