By Lucas Williams
Investment advisors can offer crypto trade services if they want to, subject to the condition that they are registered advisors as well as have assets worth more than US$ 110 Trillion. For crypto services, RIAs (i.e. the registered investment advisors) will be obligated to utilize the services of Interactive Brokers. However, the services will be limited to the US only but may extend to other parts of the world in the future.
Interactive Brokers Group, which is an international investment entity, has announced the inauguration of virtual assets trading services. However, such services will be for the registered investment advisors (RIAs) only and will be limited to US only.
The launching of the virtual asset trading services will allow RIAs to provide crypto custodial as well as trade services. For smooth functioning of the services, the services of Paxos Trust Company will be utilized. Paxos in return shall manage virtual assets as well as traditional assets on behalf of the customers. Even the management of funds into the exchange-traded funds shall be carried out by Paxos. Initially, virtual assets such as Bitcoin, Bitcoin Cash, Ethereum and Litecoin will be offered for trading.
There are about 14K investment advisors in the US which are all registered with the country’s regulator namely Securities & Exchange Commission. On the other hand, there are more than 16 million clients whose investment affairs have been handled by RIAs. Most importantly, the whole industry has been collectively managing assets worth more than US$ 110 Trillion business.
There are more than 1.33 Million individual clients available with Interactive Brokers alone. In addition, the company is exclusively managing assets of their customers which can be valuated at US$ 331 Billion. The Interactive Brokers has been rendering advisory services to customers in around 200 countries of the world. The account of the firm can be utilized to conduct trading in several assets such as futures, bonds, stocks, currencies, options, funds etc.
Interactive Brokers’ EVP, Steve Sanders, said that they feel honored to provide for crypto option to their customers. Although as compared to traditional trade options, crypto trading has limited allocation size, yet it is a worthwhile addition. He said that the company is hopeful that it will have to increase the allocation size very soon.
Sanders also informed that Paxos and the platform of Interactive Brokers will charge fee on commission basis. Their respective sharing would be based on the trade value @ 0.12 and 0.18% respectively. However, there will be no hidden fees or markups, custodial charges or even spreads.
It was further told by Sanders that initially the offer will be available to clients from the US only. However, the services can be expanded into other parts of the world in the due course.