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Fidelity cryptocurrency enters final testing phase

Posted: 1 February 2019 6:48 pm
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Fidelity Digital Assets is in the final stages of testing, working with select customers.

Fidelity, one of the world's largest asset management firms, made a heavy entry into the cryptocurrency world last October, revealing an almost fully formed cryptocurrency custody and trading solution, called Fidelity Digital Assets.

It's set to be something of a giant in the playground of cryptocurrency, and it's currently in the final stages of testing as it works with a range of customers.

Setting the standard

"We are currently serving a select set of eligible clients as we continue to build our initial solutions. We’ve established a robust set of technical and operational standards at a level that institutions have come to expect from Fidelity," it said in a recent update.

While no hard timeline was given, it made it clear that it's moving towards the pointy end of things as it continues formulating real solutions for real clients, rather than theoretically.

"Our initial clients are an important part of our final testing and process refinement periods, which will eventually enable us to provide these services to a broader set of eligible institutions," it explains. "Over the next several months, we will thoughtfully engage with and stage prospective clients based on their needs, jurisdiction, and other factors."

Its plans are to provide an all in one service for digital asset trading and custody, serving as a hub for institutional customers who want to start doing cryptocurrency in a manageable, and above all safe, way. Dealing with a trusted institution like Fidelity is essential for this.

It's somewhat ironic, but understandable, that trust has become such a crucial counterpoint to the opacity and shadiness of the cryptocurrency industry given the promise of its trustless technology.

"Our conversations with a variety of institutions have served to underscore their clear need for a trusted platform provider in order to engage with digital assets in a meaningful way. We are committed to exceeding the requirements and standards of existing solutions with both our custody platform and trading venue — providing a combination of security and a central point of market access, disrupting the obfuscated nature of trading digital assets today," Fidelity said.

At this rate it's en route to hit markets near the same time as Bakkt, which will mark the near-simultaneous entry of two giants of traditional finance to digital assets. And in both cases, there are plans to deal in "physical" bitcoin and offer actual crypto custody. The arrival of "trusted" entities to allow actual price discovery of bitcoin as an asset represents a turning point for bitcoin.

This could be where the rubber finally meets the road and we see whether people actually want to own bitcoin as "nu-gold", a hedge against traditional finance or anything else, or whether there's not much there beyond speculation and profiteering.

Place your bets now.

Disclosure: At the time of writing the author holds ETH.

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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