Fintech Wealthfront App to Offer Direct Crypto Investments Later This Year
California based investment app Wealth front is bringing the cryptocurrency to its customers later in 2021, as it sparks new retailer interest in digital assets like bitcoin and ether.
The announcement was part of a larger change the company revealed on Wednesday, where it would allow users to customize their portfolios. Previously, Wealthfront would choose a portfolio suited to the client’s risk profile.
Still, Wealthfront chief strategy officer Dan Carroll said crypto exposure in any given account would be capped at “probably no more than 20%.”
“People can go to Coinbase or Robinhood if they want to gamble, but we believe Wealthfront can become the perfect place to responsibly invest in crypto as part of a diverse portfolio,” Carroll said.
The fintech firm decided to go into crypto after seeing the interest of Wealthfront clients and the exposure to crypto in those clients’ external brokerage accounts, Carroll added.
The company has authorized users to bind their Coinbase accounts since 2018, but only started thinking about adding a cryptocurrency offering directly to customer wallets last year, Carroll added.
Wealthfront is one of several fintechs to announce plans to offer crypto services. Robinhood reported that 9.5 million customers traded cryptos in the first quarter of 2021 with the Robinhood Crypto team, tripling more than this year. In October, PayPal announced that it would offer a highly secure crypto product with a broader set of crypto ambitions going forward.
PayPal uses Paxos as its crypto back-end provider. Wealthfront has not disclosed which company it uses for crypto custody.