Fidelity Offers Commission-Free Crypto Trades with a Catch
Fidelity Investments is getting ready to offer both bitcoin and Ethereum trading to retail investors. The good news is that all trades will be commission free, though anybody seeking to engage in digital currency trading is likely to still pay a one percent fee on all the money they exchange.
Fidelity Isn’t Being Entirely Forthcoming About Its Fees
The 401K giant announced that roughly one percent fees will be attached to all transactions. Javier Paz – director of data and analytics for Forbes Digital Assets – commented in a recent statement:
Free commissions are a gimmicky way to stand out in a crowded field and yet still make a bundle via spreads. The free commission conveys a good feeling to traders to think they’re getting a deal, but only the savvy ones realize this is no free lunch.
The company is being slammed for what many industry heads and executives claim is fraudulent marketing. The idea is that Fidelity will lure traders in by not having to pay commissions, though fees will still very much be part of their transaction activities. In any case, nobody is going to get out of paying extra when they trade digital currency.
A Fidelity spokesperson is responding to the backlash and has mentioned:
Where our customers invest matters more than ever. A meaningful portion of Fidelity customers are already interested in and own crypto. We are providing them with tools to support their choice, so they can benefit from Fidelity’s education, research, and technology.
Fidelity has been making crypto headlines for the past several months. The monetary company, not too long ago, announced it was going to allow retirees to invest some of their funds into digital assets like bitcoin, though the news – while celebrated by some diehard traders who think the move will bring the space to new levels of mainstream attention – was bashed by individuals like Elizabeth Warren, the democrat senator of Massachusetts.
Warren was critical of Fidelity, claiming the company was putting its elderly customers at risk by giving them access to a relatively speculative and volatile industry that could cause all their hard-earned funds to vanish without a trace should the market endure further suffering. Warren commented in a letter:
Bitcoin’s volatility is compounded by its susceptibility to the whims of just a handful of influencers. Elon Musk’s tweets alone have led to bitcoin value fluctuations as high as eight percent.
What Are Others Doing?
While Fidelity is planning the introduction of retail trading fees, several other crypto companies are doing away with them as a means of allowing traders to deal with the bearish conditions the market has been experiencing. Emilie Choi – COO of Coinbase – recently stated:
There’s a bunch of issues with zero fees. Wash trading and so on. We are going to continue to play our own game.
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