Charles Schwab, one of the world’s biggest asset managers, on Thursday shared new details about its upcoming spot crypto trading service, saying the offer will begin a phased rollout to retail clients in the coming weeks.
The new service, called Schwab Crypto, will allow the qualified clients to trade Bitcoin and Ethereum directly. Schwab explained that the service will be alongside the investing, banking, research, and support tools that many of its customers currently have access to on the platform.
The company claimed that the launch targets retail investors who desire to have direct access to crypto in a familiar financial brand. Schwab states that the service will be comprised of spot trading and educational materials, market intelligence, and 24/7 customer service.
In its announcement, the firm also pointed to a recent survey of nearly 500 current and prospective crypto investors, where respondents said low and transparent pricing, brand reputation, and asset security were the top factors when choosing a crypto trading platform.
What Schwab crypto offers at launch
At launch, Schwab Crypto will support trading in Bitcoin and Ethereum only. Schwab called them the two most well-known and established cryptocurrencies. Together, they account for about three-quarters of the total value of the crypto market.
The company also mentioned that clients will be able to see their crypto holdings and traditional investments side by side on Schwab.com, Schwab Mobile, and thinkorswim.
Schwab reported its prices would be 75 basis points on the dollar value of every trade, which it termed as amongst the lowest in the industry. It also plans to expand the offer over time by adding more cryptocurrencies and later introducing transfer features for deposits and withdrawals.
That would allow clients who already hold digital assets elsewhere to move them into Schwab and manage them next to their other investments.
The company is also concentrating on education. It explained that the Schwab Center of Financial Research and Schwab Coaching will provide users with crypto-related content.
The given material will assist investors in comprehending the functionality of digital assets and how they could be included into a larger investment plan.
Jonathan Craig, Head of Retail Investing at Charles Schwab, said, “With Schwab Crypto, clients who want direct access to the asset class can trade it alongside their other investments, while benefiting from the service, education, and research they expect from us.”
Schwab crypto account setup
Schwab said users will open a separate crypto account that connects to their regular brokerage account. This setup will let clients manage their crypto and other investments more easily from the same platform.
Charles Schwab Premier Bank, SSB, will offer the account and serve as the custodian for clients’ digital assets. They will manage safekeeping and record-keeping.
Schwab has also partnered with Paxos to support the service behind the scenes. According to the company, Paxos will help with trade execution and sub-custody, which means it will assist with processing trades and handling part of the asset storage system.
The asset manager noted that it already has a sizable presence in digital asset investing through other products. According to Schwab, its clients currently hold about 20% of spot crypto exchange-traded products (ETFs).
Joe Vietri, head of digital assets at Charles Schwab, said the new service will let investors buy well-known cryptocurrencies through Schwab’s platform. He added that users will also get learning tools and support to help them decide how crypto may fit into their wider investment plans.
“Whether you’re new to crypto and looking for a firm you know and trust, or you already own digital assets, our goal is to be the destination of choice for retail investors who want to incorporate digital assets into their portfolios with confidence,” he added.
Rollout comes with limits and risk warnings
The company said Schwab Crypto accounts will be available in all U.S. states except New York and Louisiana. They will not be offered in U.S. territories or international jurisdictions, and not all clients will qualify.
Schwab made another point clear: the crypto sold through this service is not a security. It is not covered by SIPC or FDIC insurance either. So if the market turns sharply, there is no insured protection, and a total loss is possible.
The launch demonstrates that big traditional financial companies are increasingly entering the direct crypto services market.
Schwab is beginning with a limited selection, but its intention to add more tokens and transfer features indicates it believes there is potential for growth as retail interest in digital assets expands.
Meanwhile, another major Wall Street firm is also moving deeper into crypto. Goldman Sachs has filed for a Bitcoin ETF focused on generating income rather than only price gains.