Bitcoin and other cryptocurrency prices soared Monday after Fidelity announced the launch of a new company that could help increase access to digital currencies.
What Happened?
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Fidelity is creating Fidelity Digital Services, a new company that will deal exclusively with cryptocurrency custody and trade execution.The new company will help make cryptocurrency trading more accessible for hedge funds and other institutional investors.
Why It’s Important
One of the biggest criticisms of cryptocurrencies in the early stages of their development are that they're difficult for the average investor to access and that they will need to become mainstream in order to survive and thrive. While a number of cryptocurrency-oriented financial services companies have sprung up in recent years, Fidelity is the first traditional Wall Street form to provide cryptocurrency solutions like custody.
"Our goal is to make digitally native assets, such as bitcoin, more accessible to investors," Fidelity Investments CEO Abigail Johnson said in a press release.
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Cryptocurrencies like bitcoin have been hammered in 2018 as widespread adoption had run into roadblocks. The U.S. Securities and Exchange Commission has repeatedly refused to approve cryptocurrency ETFs, citing concerns over investor safety and lack of market liquidity.
What’s Next?
Crypto investors will be watching closely to see how smoothly the launch of Fidelity Digital Asset Services goes and whether or not it helps bring fresh money into the crypto market.
The Bitcoin Investment Trust (OTC:GBTC) gained 6.4 percent on Monday but remains down 67.2 percent year-to-date.
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