Updated 26 May, 2021

UBS Planning to Offer Crypto Investments to Wealthy Clients


Key Takeaways:

  • UBS explores options to offer crypto products to its wealthy clients
  • UBS CEO Ralph Hamers has his focus on digitalizing the bank’s operations

Interest In Digital Asset Technology By Bank

Switzerland’s largest bank, UBS, and the world’s biggest wealth manager, is exploring ways to offer its wealthy clients access to cryptocurrency assets. The Swiss bank, manages over $1tn in assets. It is reportedly seeing growing interest from clients to get involved in the crypto industry and own digital assets.

The banking giant, as reported by Bloomberg, is now in the early stages of developing a cryptocurrency trading division.  In the early stages, this would initially serve its rich clients. So, investors will only be allowed to allocate a small amount of their funds due to the volatile nature of the emerging crypto market. Also, UBS is mulling over the option to offer access to third party investment vehicles, such as Bitcoin funds or Bitcoin trusts. However, the investment firm might also consider Bitcoin-related products. In addition, this includes Bitcoin futures or other cryptocurrency-linked derivatives.

“We are monitoring the developments in the field of digital assets closely,” UBS said in a statement. “Importantly, we are most interested in the technology which underpins digital assets, namely the distributed ledger technology.”

Bitcoin Derivatives Are Way In To Crypto Industry

Ralph Hamers, the CEO of UBS and the successor of Sergio Ermotti, vowed to focus on digitalizing the bank’s operations during his time as a Chief Executive. This is why the investment firm is spending over $3bn a year on modernizing the bank’s technology and infrastructure, including finding innovative tools for employees and clients.

Direct ownership of Bitcoin by banks is not yet allowed. It is a direct result of the unregulated nature of the cryptocurrency market. Not being able to act as principals, some banks have turned to bitcoin-related products. In fact, these so-called derivatives allow indirect access to the cryptocurrency market.

Morgan Stanley, Goldman Sachs, Citigroup and JPMorgan are already offering or considering to offer cryptocurrency products and services to their clients. This comes after a soaring client demand this year.

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