Kelvin Daminabo
Fidelity Digital Assets, the crypto custody division of Fidelity, experienced a notable decrease in revenue in 2023, with a 59% decline to $695,000 compared to the previous year. Operating expenses also rose by 32% to $7.8 million, resulting in a total loss of $7.1 million for the year primarily due to reduced service-level agreement fees and increased staff salaries.
Despite these setbacks, Fidelity remains positive about its crypto custody business’s prospects, anticipating revenue growth through heightened business activity and client expansion. Since 2018, the company has been enhancing its services in the crypto sector and investing in custody and trading services.
This decline in revenue coincided with the departure of Chris Tyrer, Fidelity’s former crypto head, who left to join Bullish, a crypto exchange supported by Peter Thiel. Luc Froehlich, Fidelity International’s ex-digital assets head, has also taken on the role of chief commercial officer at Synnax, an AI-based financial platform.
Though facing losses, Fidelity’s commitment to its crypto custody business and projected revenue growth indicate a positive outlook on the cryptocurrency industry’s future direction. As the market landscape continues to change, Fidelity’s crypto custody activities are poised to shape the industry’s future developments.