The company has linked up with crypto-lending service BlockFi, which will provide the cash loans, for the service.
But that percentage figure is not set in stone. Zac Prince, Borrow money for bitcoin of BlockFi, told Bloomberg that there was "room for client-level customization in the loan terms borrow money for bitcoin the program may be adjusted to meet the needs of large firms.
This is the investment giant's first foray into crypto-lending, an industry that is rapidly growing in size. Fidelity's announcement comes at a time of increased interest in Bitcoin as an investment tool. This is the first such partnership that Fidelity has inked with a crypto-lending service.
Tom Jessop, president of Fidelity Digital Assets, told Bloomberg that adding Bitcoin as collateral for loans was a "foundational capability" and that the firm expected this feature to become a "fairly important part of the crypto ecosystem.
DeFi and crypto-lending services promise high interest rates for collateral, but the risk is also proportionally greater. Among institutional firms, Fidelity ranks as one of the first movers in digital assets.
The charter enables Fidelity to offer cryptocurrency trading and custody services to financial services and firms. The firm has ramped up its hiring of blockchain and technology professionals for the digital asset unit and is actively targeting accredited investors and institutional investors.
Last month, it announced a similar partnership to provide crypto custody for Stack funds, a Singapore-based investment firm, to get Asia's high net worth investors involved in cryptocurrencies. Fidelity's announcement comes at a time of increased institutional interest in the asset class. Several prominent managers of investment firms have spoken out about the potential for Bitcoin to become an investable asset. Compare Accounts.