Fidelity Digital Assets Score Mike Novogratz’ Galaxy Digital As First Client

Cryptocurrency merchant bank Galaxy Digital founded by billionaire Mike Novogratz is the first client Fidelity's newly launched Fidelity Digital Assets Services.


Cryptocurrency merchant bank Galaxy Digital founded by billionaire Mike Novogratz is the first client Fidelity’s newly launched Fidelity Digital Assets Services.

Fidelity Digital Assets Score Mike Novogratz' Galaxy Digital As First ClientFidelity Digital Assets is a subsidiary of global asset manager Fidelity, ranked fourth in the world with over $7.2 trillion in assets under management.

As announced last week, the platform will provide crypto custodial services and solutions targeting institutional as well as accredited investors.

Boston-based multinational Fidelity has hinted at having the infrastructure in place to cater for the cryptocurrency investment needs of its 27 million individual customers as well as 23,000 businesses around the world.

Galaxy Digital Fidelity’s “alpha” client

Only hours after launching the digital asset arm, Galaxy Digital founders announced that the firm had become Fidelity’s first custody client.

Galaxy Digital and Fidelity Investments both targets bringing the institutional investor into the digital asset space, and are therefore likely to play a huge role in the entry of institutional money into the cryptocurrency market.

Although Mike Novogratz’ Galaxy becomes the “alpha custody client,” Fidelity Digital head Tom Jessop hinted at having a “robust pipeline” of Wall Street and customers lined up for unveiling in Q1 2019.

These deep-pocketed investors would include hedge funds and family offices among other such big money investors.

At the same time, Galaxy Digital customers are likely to start investing in the crypto market in high numbers through Fidelity’s crypto investment arm. The scenario is reminiscent of how Fidelity clients have been able to purchase digital assets such as Bitcoin (BTC) and Ethereum (ETH) via Coinbase.

Analysts point out that now that Fidelity is entrusted with over $400 million in Galaxy’s crypto holdings, it’s likely that the global giant has earned the right to make digitally-native assets (like Bitcoin (BTC)), more accessible to a vast majority of Galaxy’s investors.

Increasing crypto accessibility

Fidelity Investments, which offers services such as financial planning, wealth management services, retirement plans, and trading and brokerage services, sees crypto as a significant investment vehicle that would benefit from increased accessibility.

CEO Abigail Johnson pointed out in an official press release last week increasing crypto accessibility requires all players within the digital asset space to make significant infrastructural improvements targeting the crypto asset class.

That, according to the chief executive, is Fidelity’s long-term goal in the cryptocurrency investment industry.

The corporation’s primary objective is to develop solutions that make virtual currencies like bitcoin easily accessible to a wide range of investors.

“We expect to continue investing and experimenting, over the long-term, with ways to make this emerging asset class easier for our clients to understand and use.”

Fidelity Digital Assets has been developed to make it easy for institutional investors to enter the crypto market without worrying so much about the attendant concerns of security and regulations.

Demand for these services has skyrocketed over much of 2018, with hedge funds, pension providers, and academic institutions leading in the need for crypto-related institutional products.

Galaxy Digital continues to seek ways of bringing more investors to the cryptocurrency market. Alongside Goldman Sachs, Galaxy recently participated in BitGo’s series B funding and helped to raise nearly $59 million for the startup.

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