Wells Fargo is apparently preparing to embrace bitcoin and other cryptocurrencies, as Darrell Cronk, the president of the bank’s investment institute, told Business Insider that a research division is “planning to evaluate and onboard an actively managed cryptocurrency strategy to its platform for qualified investors.”
He noted that efforts to deploy such a product have been in the works for months and is likely to launch in the middle of next month.
While the product would apparently offer exposure to many cryptocurrencies, Cronk highlighted the decreasing supply dynamics of a deflationary asset like bitcoin in particular as a reason his team is interested in offering it.
“Anytime you reduce the supply of anything, even if demand holds constant, it should increase the price,” Cronk told Business Insider, offering a basic explanation of bitcoin’s value proposition over inflationary assets like the dollar. “Over time, as people become more familiar with these [cryptocurrencies] and as they become more mainstream, I think it will naturally go up. We’ve seen that happen quite consistently over the last decade but we’ve seen it accelerate during the pandemic because there’s been more digitalization of platforms.”
Offering bitcoin exposure would be a fairly dramatic about face for Wells Fargo, which was not allowings it banking clients to make cryptocurrency transactions as recently as July 2019.
But it would also be in line with a growing trend from Wells Fargo’s competitors. Goldman Sachs and JPMorgan Chase & Co. are reportedly seeking to offer similar products giving clients exposure to bitcoin as well.