Wells Fargo now offering crypto services to its high-net worth clients

As reported in Business Insider, high-net-worth Wells Fargo clients can now get their fair share of Bitcoin and other cryptocurrencies. The firm’s wealth and investment management division currently handles $2 trillion in assets and is thereby one of the largest wealth managers in the United States.

While it was already hinted at as early of May this year that the firm was going to offer crypto services to its clients, the recent development makes Wells Fargo the latest in a long line of traditional financial institutions to enter the crypto space.

Although Wells Fargo has publicly expressed some caution with regards to Bitcoin and other cryptocurrencies due to their regulatory vagueness, the company has been looking for “a professionally managed solution” according to Darrel Cronk, president of its research division.

Right now, it remains unclear how exactly high-end clients at Wells Fargo are going to get exposure to Bitcoin with numerous options available. It could be by outright purchases of Bitcoin but also by indirect exposure by means of a funds, such as the example of Grayscale’s Bitcoin Fund.

Supply & Demand

According to Cronk, the rationale for Bitcoin lies to the understanding of its supply and scarcity dynamics, as he said:

“Anytime you reduce the supply of anything, even if demand holds constant, it should increase the price. Over time, as people become more familiar with these and as they become more mainstream, I think it will naturally go up.”

He further noted that they will be able to mitigate risk factors involved:

“There’s a whole element of consumer protections and regulations that have to still evolve with the changing landscape. We think there can be a viable investable option for those clients who show an interest.”

Wells Fargo’s announcement comes short after traditional banking giant JPMorgan was reported to start offering its retail wealth management clients access to a select number of cryptocurrency funds.

Fellow banking giants, Goldman Sachs and Citigroup have already leaned over to larger role in the cryptocurrency sector. The former now  considering Bitcoin a new asset class and even bringing Ethereum products and services to its clients.