“Institutional Herd” to Enter Crypto Market by Q1 2019, CNBC’s Bryan Kelly Says

Crypto bull Bryan Kelly has hailed Fidelity’s foray into the digital assets market, and expects more institutional players to follow suit.

A growing number of traditional financial services giants have recently indicated interest in the cryptocurrency market. Brian Kelly, CEO of crypto investment firm BKCM and a CNBC contributor, expects this trend to continue, with the “institutional herd” arriving by the first quarter of 2019.

Last week US financial services giant Fidelity Investments announced the launch of a new company offering digital assets trading and storage services. Called Fidelity Digital Asset Services, the new venture will provide hedge funds, family offices, and other financial institutions with enterprise-grade custody solutions, cryptocurrency trade execution, and dedicated customer support service.

According to Kelly, Fidelity’s foray into the cryptocurrency space is “fantastic news”. Commenting on CNBC’s Power Lunch show last week, he said:

“Custody has been a very big hurdle. And having somebody like Fidelity put their stamp on it and say yes, this is a new asset class and we’re going to custody this – and I believe they even said they may have some insurance. So that is a step closer.”

Kelly added that coupled with Yale’s recent investment in a cryptocurrency-oriented fund, Fidelity’s move signals a shift that will continue to grow through the new year.

“Now, you have Yale investing. The Yale endowment. This has put everybody on notice at least in the institutional area. You either have to have a strategy for investing in this, or you have to have a reason why you’re not. So I would expect over the next three months, six months, you start to see the proverbial herd really start to turn in this direction. And I can just tell you from the conversations we’ve had for our crypto hedge fund, that herd is starting to enter this market,” Kelly stated.

He went on to suggest that retail investors will not be left out in the expected crypto market development. According to the CNBC contributor, Schwab and ETrade could already be working on crypto solutions for retail investors that could be introduced as soon as Q1 2019.