Fidelity clients will be able to access liquidity by leaving their bitcoin to the signature. Fidelity alleges that institutional interest in bitcoin is growing steadily.
Fidelity Digital Assets, the division of the digital assets of the firm Fidelity Investments, announced that its institutional clients will now be able to opt for loans by placing funds in bitcoin (BTC) as collateral.
To do this, the firm united paths with the startup BlockFi, a company that focuses on providing this type of loan services with cryptocurrencies and liquidity providers for the BTC futures contract system in CME, Fidelity explained through a press release this December 9.
Christine Sandler, Head of Sales and Marketing at Fidelity Digital Assets, explained through this press release that this new product arises after noticing “the demand for greater capital efficiency from institutions that maintain long positions in bitcoins.”
The firm also highlights the growth in demand for exposure to digital assets in the institutional sphere recently. According to data from a Fidelity survey, 36% of institutions have investments in these types of assets.
Fidelity claimed that it expects sustained growth in demand for bitcoin financing solutions, on par with the increased interest they have been seeing in recent times.
The company relates this interest to the current state of the economy, political, and monetary decisions in the wake of the pandemic, as well as “a search by investors for a pool of uncorrelated assets of value with upside potential.”
“The commercial and market momentum we have seen this year strengthened our belief that institutional investors are seeking a more comprehensive offering in the digital asset space, and we look forward to continuing to evolve our platform to meet their needs and deliver even more value for our clients,” said Christine Sandler, Head of Sales and Marketing at Fidelity Digital Assets.
“Having the ability to fund positions is a critical component of the financial services infrastructure and this collaboration reflects an exciting development for the digital asset ecosystem,” said Zac Prince, CEO, and Founder of BlockFi.
Bitcoin as a store of value
As Fidelity Digital Assets just exposed, institutional interest in bitcoin skyrocketed in recent months. It is not only about the fact that many companies opened their doors and joined the game with large investments in cryptocurrency, but traditional banking, stock indices, and digital payment companies also begun to see bitcoin as a value bet.
Fidelity itself published last July the first part of a report called the Bitcoin Investment Thesis. on which the firm talked about bitcoin not only as a store of value but also as “an insurance policy”, In the second part of the report, released in October, the company valued the ability of bitcoin to make diversified investment portfolios more profitable.
As an investment, bitcoin’s performance this year was exceptional. Not only for its percentages itself. Also, when comparing the returns of the cryptocurrency with those of traditional investments, such as indices, company stocks, and even precious metals.
By Jenson Nuñez
