Fidelity Investments accepting Bitcoin as collateral

Posted: 10 December 2020 5:30 pm
Ladder on Stack of Coins

Bitcoin remains well within range of beating its all-time high set in 2017.

The fanfare for Bitcoin and the cryptocurrency market in general continues to gather pace, as Fidelity Investments adds yet another Bitcoin product to its services.

Fidelity has partnered with BlockFi to offer cash-loans using Bitcoin as collateral. Essentially, holders of Bitcoin will be able to deposit the asset with Fidelity Investments and BlockFi will credit customers with cash-loans for 60% of face value.

According to its website, Fidelity Investments has a total discretionary asset value of $3.4 trillion. Since 2018 the wealth management behemoth has slowly been developing its digital assets service offering.

Learn more about cryptocurrency loans here

The new service is aimed at opening credit accounts for Bitcoin investors, digital miners, over-the-counter trading desks as well as hedge funds according to Tom Jessop, President of Fidelity Digital Assets which is a subsidiary of Fidelity Investments.

This adds legitimacy to the growing asset class providing greater liquidity to the market in the form of high net worth draft accounts. Jessop supported this by saying that "as the markets grow, we'd expect that this becomes a fairly important part of the ecosystem".

Bitcoin was trading at $18,456 at the time of writing, slightly down on the 24-hour peak of $18,647. Today's high represents a $915 gap from the day's low of $17,732 providing ample volatility for micro traders.

Looking at Bitcoin's performance over the week, the market has seen its spot value decrease over 5.8% shedding around $1,150. This is coming off a fresh run challenging all-time highs for Bitcoin which reached as high as $19,568 just this week. This is less than $500 shy of the Bitcoin all-time high set in December of 2017.

Other vital signs for Bitcoin are relatively stable or positive. Total Bitcoin transactions remain within the year's average of around 300,000 transactions per day. The value of Bitcoin transactions over the month hasn't changed unexpectedly. However, that figure of around $4.5 billion is a marked increase from the first half of the year which saw the value of Bitcoin transactions average at around $2 billion, suggesting stable transaction volume even as prices rise.

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Bitcoin price movement over the past 24 hours.

Interested in cryptocurrency? Learn more about the basics with our beginner's guide to Bitcoin, keep your crypto safe with a hardware wallet and dive deeper with our simple guide to DeFi.

Disclaimer: This information should not be interpreted as an endorsement of cryptocurrency or any specific provider, service or offering. It is not a recommendation to trade. Cryptocurrencies are speculative, complex and involve significant risks – they are highly volatile and sensitive to secondary activity. Performance is unpredictable and past performance is no guarantee of future performance. Consider your own circumstances, and obtain your own advice, before relying on this information. You should also verify the nature of any product or service (including its legal status and relevant regulatory requirements) and consult the relevant Regulators' websites before making any decision. Finder, or the author, may have holdings in the cryptocurrencies discussed.

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