Fidelity becomes Canada’s first institutional Bitcoin (BTC) custodian

Fidelity Investments, a renowned financial services company, has unlocked another milestone. The company’s subsidiary, Fidelity Clearing Canada, has won the regulatory approval of the Investment Industry Regulatory Organization of Canada (IIROC) to launch the first institutional BTC custodial service in Canada. 

According to the report, Fidelity Clearing Canada will enable Canadian pension funds, mutual funds, exchange-traded funds (ETF), portfolio managers, and other qualified institutional investors to dabble in BTC directly. Before this, Canadian institutional investors had to use US-based custodians. 

Commenting on this development, Scott Mackenzie, the President of Fidelity Clearing Canada, said,

“This is a very exciting development for our clients, interested Canadian institutional investors, and for Fidelity Clearing Canada.”

Striving to satisfy investor demands

Mackenzie added that the demand for investing in crypto is rising rapidly, and institutional investors have been looking for a regulated dealer platform to access the nascent asset class. He added that Fidelity Clearing Canada would leverage Fidelity’s global expertise and deep knowledge of digital assets to satisfy the demands of institutional investors. 

Bullish that winning IIROC’s approval will be transformative, Mackenzie said Fidelity Clearing Canada is looking forward to working with current and prospective clients to help them get exposure to BTC. He added that the firm and its clients are experiencing tremendous growth and success due to the continuous investments into its platform and service offerings. 

Mackenzie pointed out that the company has doubled its assets under management over the past two years after leading wealth management firms in Canada chose it as their solution partner. As such, he believes getting the go-ahead to offer BTC custodial and trading services will help keep Fidelity Clearing Canada’s strong momentum going. 

An offering for retail investors is cooking

Fidelity is also looking to tap into Canada’s retail market by launching an exchange-traded fund (ETF) and a mutual fund. Reportedly, Fidelity Clearing Canada filed two applications for Fidelity Advantage Bitcoin ETF and Fidelity Advantage Bitcoin ETF Fund earlier this week. 

Unlike in the US where the SEC is hesitant to approve a pure-play BTC ETF, Canada’s Ontario Securities Commission (OSC) approved the first BTC ETF in February this year. With the regulator having approved one BTC ETF already, it is likely that Fidelity Investments, which has over $4.2 trillion in assets under management, will see its application sail through. 

However, the company’s ETF is set for stiff competition, with investment firms like Accelerate Financial Technologies using ingenious methods to woo investors. Reportedly, the company has vowed to plant 3,450 trees for $792,000 that investors pump in its pending BTC ETF. In so doing, the company aims to attract investors by presenting itself as a firm that cares about making BTC carbon negative. 

BTC fails to react to this news

While the news of IIROC approving Fidelity Clearing Canada to operate as a BTC custodian is bullish, the flagship cryptocurrency is still trading sideways. At the time of writing, the leading crypto by capitalization is changing hands at $59,665.06. This figure represents a 0.08% drop in 24 hours and an 8.22% slump over the past seven days.


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