Fidelity’s crypto custody business records 60% loss in 2023

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As a seasoned crypto investor with a keen interest in following the latest developments within the industry, I find Fidelity Digital Assets’ recent financial report disheartening. Having closely monitored their expansion into the crypto custody business since its inception in 2018, it is disappointing to see such significant losses and declining revenue.

As a crypto investor, I’ve noticed that Fidelity Digital Assets reported a significant decrease in revenue for the year 2023, amounting to nearly 60%. The financial losses they incurred exceeded £7 million during this period.

In 2018, Fidelity Digital Assets, the crypto custody business of Fidelity, entered the market to broaden its digital asset offerings. According to Financial News, which referenced documents submitted to Companies House, this division generated approximately £545,000 (or $695,000) in revenue during the previous year. This figure represents a significant decrease compared to the £1.34 million ($1.74 million) earned in 2022, representing a decline of roughly 59%.

The operating costs at Fidelity Digital Assets rose by an substantial 32% year-over-year, reaching £7.8 million in 2023, primarily due to higher staff salaries. Consequently, the company recorded a loss of £7.1 million for that year, marking a significant increase from the previous year’s loss of £2.5 million.

Regarding the projected income, Fidelity indicates that their revenue is anticipated to climb as a result of expanding business activity in custody and trading services, with the addition of new clients expected. However, it’s important to note that this growth is aimed to offset the decrease in service-level agreement fees that have contributed to the current revenue decline.

In the beginning of 2023, Chris Tyrer, who had spearheaded Fidelity’s cryptocurrency initiatives since his appointment as Europe‘s crypto chief in 2019, departed from the company. Later in May, Tyrer joined Bullish, a crypto exchange boasting Peter Thiel’s support, assuming the role of head strategy.

Around the middle of May, crypto.news announced that Synnax, a financial platform utilizing artificial intelligence for credit assessment and evaluation, welcomed Luc Froehlich, former head of digital assets at Fidelity International, as their new chief commercial officer. He will be responsible for guiding Synnax’s commercial plans and overseeing operations.

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2024-06-04 15:09