Fidelity Digital Assets Expands Among Growing Interest from Institutional Investors

Fidelity increases workforce amid surge in demand—signals rising interest in digital asset investment products.

As demand from institutional investors for more digital assets products has grown, Fidelity plans to upscale its digital assets workforce. Fidelity Digital Assets will add 100 staff to offices in Salt Lake City, Boston, and Dublin. 

Investment giant expands digital assets products

Tom Jessop, President of Fidelity Digital Assets, stated that the company aims to develop new products and expand its digital assets offerings beyond Bitcoin. He added that: “2020 was a real breakthrough year for the space, given the interest in Bitcoin that accelerated when the pandemic started. We’ve seen more interest in Ether, so we want to be ahead of that demand.”

Fidelity Digital Assets just offers custody, trading, among other services for Bitcoin at present. However, the digital assets arm of the investment company will push to offer trading throughout the week. Digital assets trade all day every day—unlike most financial markets, which close in the afternoon and at the weekend.

Growing interest in digital assets among institutional investors

As digital assets and decentralised finance gain mainstream acceptance, money has been pouring into the space to fund startups and new ways of conducting traditional financial transactions.

Indeed, venture capital funds have committed more than $17 billion to blockchain-based projects in 2021 so far. This is the most in any single year and almost equal to the total amount raised in all previous years combined. Firms raising money include Chainalysis, Blockdaemon, and Coin Metrics.

Looking beyond Bitcoin: Ether and DeFi

Institutional investor demand for access to Bitcoin, Ether, and other digital assets is rising. In-line with this, Fidelity plans to push other digital assets-related products. 

Fidelity Digital Assets clients include family offices and hedge funds. That’s now expanding to retirement advisers and corporations that want to hold digital assets as an asset class, Jessop commented. He also noted that Bitcoin has been the main interest of institutions entering the space, but they’re now broadening their scope. "Bitcoin has really been the entry for a lot of institutions. It's now really opening up a window on what else is going on in the space," Jessop said.

Since December 2020, Fidelity has allowed its customers to borrow fiat loans against as much as 60% of their Bitcoin holdings. The digital assets-backed loans are offered in a partnership with New York-based BlockFi, a wealth management platform for digital assets investors.