Brokerage firm Interactive Brokers Group has announced that it is launching crypto trading for investment advisors. The firm is bringing cryptocurrency investment to investment advisors in the U.S. to help streamline the process of investing clients’ funds in the market. Financial advisors are able to invest and custody cryptocurrencies like Bitcoin, Bitcoin Cash, Litecoin, and Ethereum for their clients with the new feature.
Partnership With Paxos
In order to bring this new feature to its customers, Interactive Brokers partnered with regulated blockchain infrastructure platform, Paxos. Paxos Trust Company will provide a platform where the investment advisors are able to purchase and custody cryptocurrencies for their clients, in addition to other investment options.
Using Paxos, investment advisors can easily manage the portfolios of their clients. They will be able to manage investments like stocks, bonds, options, futures, and cryptocurrencies all from the same place.
Investment advisors are also not limited in the investments which they can manage through this integration. They can manage various investments from all around the world on a single screen from the Interactive Brokers platform.
Total crypto market cap now at $2.51 trillion | Source: Crypto Total Market Cap on TradingView.com
In addition, Interactive Brokers is offering investment advisors some of the lowest fee rates in the space. Instead of the usual high fees of 2% or more of trade value, investment advisors will see commission rates as low as 0.12% to 0.18% on trades, subject to monthly volume. There are also no added spreads, markups, or custodial fees.
Interactive Brokers will roll out the new feature to investment advisors in the United States to start. But will eventually expand its offerings to investment advisors around the world.
Bringing Crypto To The Forefront
Interactive Brokers launched the service in order to enable their customers to diversify their portfolios. Cryptocurrencies have long been presented as a good way to diversify investment portfolios and more investment firms are jumping on the train.
Senator Cynthia Lummis said in February that bitcoin “is an excellent store of value and that it should be part of every individual person’s investment portfolio.” This is due to bitcoin outperforming most financial markets year-over-year.
Speaking on the new feature, Steve Sanders, EVP of Marketing and Product Development at Interactive Brokers, said;
“Allocating a small percentage of assets to cryptocurrency as part of a well-diversified portfolio has steadily become more commonplace, and advisors may wish to recommend cryptocurrency to their clients. Adding cryptocurrency trading underscores our ongoing dedication to providing advisors with the investment products and tools they need to successfully manage client portfolios and grow their businesses.”
The crypto trading service offered by Interactive Brokers allows customers’ assets to be held in bankruptcy remote, segregated accounts. And given that the firm is regulated by the New York Department of Financial Services, it provides the needed oversight required to make sure that consumers are protected in their investments.
Featured image from Washington City Paper, chart from TradingView.com