Customers will now be able to trade bitcoin, but they cannot withdraw it into their own custody.
Fidelity Investments clients may now purchase bitcoin via Fidelity Digital Assets. The Fidelity Crypto platform, first made accessible to a waitlist in November 2022, is now open to the general public as of yesterday.
Consumers may purchase and sell bitcoin but cannot move it to a wallet where the user holds the private keys. Upon the debut of the waitlist, this feature was mentioned as a future addition, but no more information or plan has been offered.
Customers will not be paid a “fee” for trading, but rather a 1% spread, which Fidelity defines as “the difference between the price at which you purchase or sell cryptocurrency in your Fidelity Crypto account and the price at which Fidelity Digital Assets fills your order.” This spread will be reflected in the execution price for the customer. Trade will be restricted to U.S. residents over 18 in states that qualify.
A group of senators, in a letter to the banking institution, criticized Fidelity’s entry into the cryptocurrency market, stating:
“Fidelity Investments has decided to go beyond conventional finance and into the extremely volatile and more dangerous market for digital assets.”
But, it seems that this has not stopped Fidelity. Self-custody should be emphasized more at times, such as during the present financial crisis, even though their introduction of the service to the public is likely to be positive. A lack of faith in huge organizations such as Fidelity precipitated the last week’s problem.
Although Fidelity is often viewed as a highly-trusted organization, it should be underlined that responsible third parties are security vulnerabilities and that possessing one’s private keys is the only way to utilize bitcoin sovereignly.
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