Bitcoin First, Ethereum Later
At long last, Fidelity’s cryptocurrency subsidiary, the fittingly-named Fidelity Digital Asset Services (FDAS), is nearing a full launch. FDAS chief Tom Jessop, formerly of Goldman Sachs, Standard & Poor’s, among other Wall Street institutions, touched on the subject matter in an interview with CoinDesk. He told the outlet that while the branch’s advent is nearing, they have yet to integrate Ethereum (ETH).
Jessop remarked that his organization has created an evaluation process for cryptocurrencies, likely much like Coinbase’s, in a bid to support bonafide projects with potential. Currently, FDAS has only given Bitcoin (BTC) its stamp of approval, even though Jessop has stated that Ether and other popular cryptocurrencies may see support eventually. He elaborated:
We’re currently supporting bitcoin, we have designs to support other coins over the balance of the year center to various criteria including our [in-house selection framework], where we obviously look … at client demand and other things.
These “other things,” which are universally applied to other assets, like Ethereum, include the decentralization status of a coin (presumably the number of nodes/miners, consensus mechanism, hashrate distribution), the level of demand from the Boston-based firm’s clientele, the peculiarity of the blockchain, which would affect how FDAS integrates the asset. While Jessop did hint that his crypto firm’s clients have expressed interest in Ethereum-related services, he noted that with upcoming hard forks/blockchain upgrades, like this October’s Istanbul or the following years’ steps towards Serenity, Fidelity may need to “see how those things work out.”
If Jessop is serious, that means that ETH services may not launch on FDAS until late 2019, months after the initial launch of the startup. But to give his reasoning some more credence, he drew attention to Ethereum Classic, which suffered a 51% attack to its blockchain earlier this year. While the same isn’t likely to occur to the ETH chain, Jessop & Co. may be worried about the stability of the chain following a further step towards PoS (which miners may find contentious).
Crypto Services Live For Eligible Clients
While the lack of Ether support may irk some of Fidelity’s thousands of institutional clients, the bottom line is that the service is live. A recent tweet from the Wall Street-backed startup corroborated this. Citing a company update which Ethereum World News reported on previously, FDAS revealed that it is now live, or at least in a limited capacity. The firm tweeted the following seemingly in tandem with the Coindesk report:
Moving ahead into 2019, Jessop intends to see his firm scale, specifically in a bid to see FDAS consume 90% of the States’ institutional crypto market. He claims that this scaling will take the form of regulatory green lights, along with ironing out any bugs in the platform. This will be of utmost importance, as the FDAS head noted that Fidelity has seen a “significant amount of demand” in regards to cryptocurrencies, from crypto-native firms to hedge funds.
This could finally be a positive sign for this market moving forward. Just yesterday, prominent analyst The Crypto Dog took to Twitter to lay out a number of reasons why Bitcoin bears shouldn’t, well, be bearish. A primary facet of his list, which includes Binance’s ventures, Argentinian government blockchain involvement, and Bakkt’s (potential) Starbucks integration, was the launch of Fidelity’s cryptocurrency arm. CNBC contributor Brian Kelly touched on this too, explaining yesterday that this is one reason why it appears that the “crypto winter” is starting to thaw.
Title Image Courtesy of Descryptive.com Via Unsplash