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Fidelity, Citadel & Charles Schwab to Build Crypto Exchange

They announced a partnership to build a crypto trading exchange with tech provider EDX Markets.

Wall St Street Sign
Photo by Patrick Weissenberger on Unsplash

In a press release, investment giants Fidelity, Citadel Securities, and Charles Schwab announced a partnership to build a crypto trading platform. In cooperation with EDX Markets, institutional and retail clients can buy bitcoin and other cryptocurrencies through the platform.

Investment giants plan crypto trading platforms

On Monday, the Wall Street Journal reported that Fidelity Investments was planning to offer a brokerage service to 34 million customers through their platform. The company did not initially confirm this rumor. Then, a day later, the partnership between Fidelity, Citadel Securities, and Charles Schwab was announced.

EDX Markets (EDXM) will provide the platform's infrastructure. The company was founded in 2019 that specializes in developing digital applications. EDXM's infrastructure will enable both institutional and retail investors to use the service, according to the press release. Jamil Nazarali, CEO of EDX Markets, also expressed satisfaction with the partnership:

"We look forward to welcoming more participants to our platform that will drive ongoing trading in this important asset class while creating a virtuous cycle of continuously improved liquidity and efficiency supported by EDXM's cutting-edge technology." Jamil Nazarali

Other notable contributors to the project include Paradigm, Sequoia Capital, and Virtu Financial, which additionally serve as venture capitalists and manage billions of dollars in assets.

The role of Fidelity

Fidelity, with about $4.5 trillion in client assets under management, is a well-known proponent of the largest digital currency. The company has been involved in the bitcoin market since 2015 and now provides several bitcoin services to its clients.

For example, the company offers Bitcoin retirement savings plan to its U.S. customers, which many politicians have heavily criticized. The U.S. Department of Labor said at the time that it was concerned about companies' decisions to allow their employees to invest in cryptocurrencies through their Fidelity retirement plans. Several U.S. senators had also raised questions about the project, citing the risks associated with investing in such risky assets.

In a detailed report, Fidelity explained the uniqueness of the Bitcoin network and stressed that Bitcoin is not comparable to other cryptocurrencies. The asset manager is also active in Europe, launching its first European Bitcoin exchange-traded product (ETP) in February.

With the development of a crypto trading platform, Fidelity will tap into this market area. While the company has not yet confirmed that Fidelity clients will soon be able to trade Bitcoin through its platform, the new partnership between the financial services firms suggests that they will. The cooperation between Fidelity, Citadel Securities, and Charles Schwab is another sign that Bitcoin has also arrived in the traditional financial world (TradFi).

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