Fri. Apr 16th, 2021


  • Crypto Council for Innovation will focus on government relations, education and the publication of research on key issues.
  • Its members are Fidelity, Coinbase, Square and Paradigm, an investment firm which convened the group.

Fidelity Investments and three other investment firms have formed a trade group to educate the public, governments and institutions about cryptocurrency assets and to promote “responsible regulation” of those assets, they say.

In its inaugural announcement, the Crypto Council for Innovation said it aims to show the promise of “this transformational technology” and to separate “fact from perception” through government relations, education and the publication of research on key issues.

“The recipe for good policy requires convening regulators and industry to devise solutions together,” according to the announcement.

In addition to Fidelity, the council includes Paradigm,  a crypto-focused investment firm based in San Francisco which convened the council; Square, a company that provides mobile payment solutions, has invested at least $200 million in Bitcoin and is led by CEO Jack Dorsey, who also is Twitter’s CEO and cofounder; and Coinbase, an online platform for buying, selling, transferring and storing digital currency.

“Strengthening the digital assets ecosystem through research and collaboration has been a focus for Fidelity for many years because we believe that this technology and digital assets will represent a large part of the financial industry’s future,” said a spokesperson for Fidelity Digital Assets, created in 2018 to provide custody and trade execution services for crypto assets owned by institutional investors like hedge funds and family offices.

“Initiatives like the Crypto Council for Innovation allow us to work with other leaders in the ecosystem to create sustainable solutions that advance our industry and enable broader adoption,” added the spokesperson.

Gus Coldebella, chief policy officer at Paradigm and one of the organizers of the council, said in a statement that the council’s work  “will require sharing insights and analysis about crypto, while correcting the misperceptions that inevitably accompany a transformative new technology.”

Growing Interest in Crypto Assets

The council’s formation is among the latest steps that financial firms have taken to popularize investments in crypto assets, whose numbers are steadily growing.

Crypto assets include cryptocurrencies like Bitcoin, which uses blockchain technology to encrypt, regulate, and verify the transfer of funds between people; stablecoins, like Tether, that are pegged to a fiat currency such as the U.S. dollar; and non-fungible tokens, which are unique crypto collectibles that can’t be changed, removed or destroyed.

NFTs include pieces of digital art, sports trading cards and even tweets, as in Dorsey’s first tweet, many of which sell for millions of dollars.

In addition, there are crypto funds such as the Grayscale’s Bitcoin fund and Fidelity’s Wise Origin Bitcoin Trust, which are available only to qualified investors and have a $100,000 minimum investment level.

There also are multiple applications for Bitcoin ETFs pending before the SEC, including one from Fidelity, which already offers Bitcoin custody services.

BNY Mellon  recently announced its plans to roll out a digital custody unit later this year, and Goldman Sachs plans to begin offering investments in digital assets to wealthy clients in the second quarter.