Bitcoin Stabilizes as Fidelity Sets Launch Date for New Crypto Custody Service
Bitcoin saw little upside on Wednesday, as traders shrugged off reports that Fidelity Investments was targeting March for the launch of its new crypto custody service.
Bitcoin’s price was last seen approaching $3,500, according to aggregate data provider CoinMarketCap. Over the past 24 hours, the digital currency has gained 1.6% to $3,493.18. On individual exchanges, BTC/USD traded as low as $3,445 on Gemini and as high as $3,529 on Bitfinex.
The following chart, which is based on Bitstamp data, shows weak underlying momentum via RSI and MACD.
This contrasts with the hourly chart, which shows stronger upside potential.
Bitcoin’s modest rally was accompanied by a slight drop in Tether (USDT), a dollar-backed stablecoin that is often used to buy digital currencies. USDT is down 0.3% at $1.01.
Bitcoin and USDT are the two most actively traded cryptocurrencies on the market. Bitcoin’s trade volumes exceeded $5.8 billion on Wednesday. USDT volumes reached $4.1 billion in the last 24 hours.
The overall cryptocurrency market capitalization improved to $115.6 billion on Wednesday after bottoming near $111 billion earlier in the week. Read more: As Bitcoin Selloff Resumes, Crypto Markets Could Be Headed for New Lows.
Fidelity Investments Enters Crypto
Fidelity Investments is planning to launch a bitcoin custody service as soon as March to help institutional investors ease into cryptocurrency, Bloomberg reported Tuesday. The Boston mutual fund manager first announced plans to ramp up its crypto business back in September and said additional details will soon follow.
“We are currently serving a select set of eligible clients as we continue to build our initial solutions,” the company said in a statement. “Over the next several months, we will thoughtfully engage with and prioritize prospective clients based on needs, jurisdiction and other factors.”
As Bloomberg reports, dedicated storage for bitcoin will be the first service offered by Fidelity. Ethereum will soon follow.
Custody is seen as a crucial first step in attracting institutional investors to cryptocurrencies. The service essentially involves a third party holding onto securities to reduce the risk of loss or theft. A more reliable mechanism for trading, holding and storing bitcoin could make crypto more palatable to traditional investors.
Where is bitcoin headed? Read: Crypto’s Road to Recovery Is Paved With Obstacles.
Fidelity has been a major proponent of cryptocurrency, setting it apart from other Wall Street firms. The company has been mining crypto since at least 2014. As Hacked reported last month, it was also one of several companies to throw its weight (and capital) behind ErisX, a new cryptocurrency exchange. The exchange aims to improve “the digital asset trading experience for institutions and individuals alike,” according to its official website.
Disclaimer: The author owns Bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
Featured image courtesy of Shutterstock.