Fido's In

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TBI - October 15, 2018

Fido is officially in.

After years of internal experiments, a teaser of a Coinbase integration last year, and perhaps some social pressure from fast-moving Wall Street competitors, the asset management giant unveiled its plans to launch a crypto custody and institutional brokerage business. Fidelity Digital Assets will launch in 2019, headed by former Goldman Sachs MD and Chain President Tom Jessop.

They’ll offer three primary services initially:

1. An enterprise custody solution and “vault" for bitcoin, ether and other digital assets, which should be immediately competitive with BitGo, Coinbase, and Xapo. (I expect late-to-the-party rival Wall Street institutions to FOMO into some juicy M&A next year.)
2. A trade execution service that routes orders at the lowest available prices. Sounds simple/obvious, but this has been a major hold up to brokers working with crypto given the market’s fragmented liquidity. Fidelity’s new services will leverage an internal engine that pulls from multiple third-party liquidity providers, and fills orders on a "best execution" basis.