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Fidelity Weighs Bitcoin Trading on Brokerage Platform

Fidelity Investments is considering a plan to allow individual investors to trade bitcoin on its brokerage platform, people familiar with the matter said, marking the financial giant’s latest foray into cryptocurrencies.

Fidelity launched a bitcoin trading company for hedge funds and other institutional investors in 2018, and earlier this year allowed corporate clients to add the digital asset to the 401(k) retirement plans it manages for them. Now the Boston firm is working to bring crypto to its more than 34.4 million brokerage accounts, the people said.

Led by its chief executive, Abigail Johnson, Fidelity was one of the first mainstream financial firms to champion digital assets and the technology behind them. Ms. Johnson began holding weekly crypto discussions with her lieutenants nearly a decade ago, and in 2015, Fidelity began mining bitcoin. It later added a link on retail customer accounts to Coinbase,

the crypto exchange, to track their holdings. In 2020, it opened its own crypto fund for high net worth clients.

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When Fidelity opened its 401(k) accounts to bitcoin, industry executives came to believe it was only a matter of time before the company moved to allow brokerage clients to hold crypto in their accounts. Some of its competitors including Robinhood Markets Inc.,

have used access to digital assets as a key selling point for a new generation of investors who in 2020 had started trading everything from stocks and options to bitcoin.

On Monday, Mike Novogratz, CEO of Galaxy Holdings Ltd. and one of Fidelity’s first crypto clients, indicated that Fidelity would soon be joining them.

“A bird told me that Fidelity, a bird in my ear, is going to move their retail customers to crypto soon enough,” Mr. Novogratz said during a speech at the SALT conference. “I hope that bird is right. And so we see this institutional march.”

Fidelity has not yet shared its plans with its clients.

Anything Fidelity does to expand the reach of crypto for individual investors is likely to be scrutinized by Washington. The US Department of Labor has said it is concerned about companies’ decisions to allow their employees to invest in cryptocurrencies through their Fidelity retirement plans. Several US senators have also raised questions about the plan, citing the risks inherent in investing savings in such risky assets.

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Coinbase went public with a long-awaited listing in 2021, but when the crypto market crashed, the company’s stock price fell more than 80%. Now it works to diversify its earnings. WSJ’s Paul Vigna explains what went wrong. Illustration: Jacob Reynolds

—Vicky Ge Huang contributed to this article.

Write to Justin Baer at [email protected]

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