Fidelity's crypto platform is now open. Is there something good?

Fidelity Investments introduced digital assets to its approximately 40 million retail customers for the first time when it rolled out its crypto services in 2021.

Cryptocurrency is not suitable for everyone. It can be risky, unstable, and difficult to operate. Fidelity's products primarily simplified the process for investors by starting with just a few crypto options.

Fidelity Crypto may be attractive to investors interested in: cryptocurrency And we already know and trust Fidelity's investments.

However, if you are already an avid crypto investor, you may not be interested in switching solely to these new services. Although Fidelity's low transaction costs make it competitive with some of the larger companies, cryptocurrency exchangethe selection and crypto features announced by the company are still not up to par.

For example, Fidelity only offers two cryptocurrencies. Bitcoin And Ethereum. Users also cannot send or receive cryptocurrencies from their accounts. This is essential for users who use cryptocurrencies for payments or access blockchain-based services on the web. However, you can sell cryptocurrencies for fiat currency.

Here are some factors to consider when evaluating Fidelity's cryptocurrency services.

Fidelity offers its customers what it calls “fee-free” cryptocurrency trading. That doesn't necessarily mean trading is free. The company states that virtual currency transactions are subject to spreads of up to 1%.

Still, this compares relatively well to other crypto services reviewed by NerdWallet. Coinbase, the largest U.S. exchange focused exclusively on cryptocurrencies, often charges a fee of $2.99 ​​for simple transactions, which can exceed 1% for small purchases.

Other crypto services may charge fees of 10% or more, depending on your payment method.

Funding your Fidelity Crypto account is easy if you already have a brokerage or money management account with the company. You will now be able to transfer funds from your Fidelity account to Fidelity Crypto.

There is no minimum deposit amount to open a cryptocurrency trading account. And, according to Fidelity, the minimum purchase amount for cryptocurrencies is $1. These factors place the company on par with most other large exchanges.

If you don't have a Fidelity account, you'll need to create and fund an account, such as a brokerage or money management account, to make a purchase.

Fidelity Crypto is initially available in 35 states. If you can't access the service in your state, you'll need to choose another option.

Fidelity Crypto's service is on the low end of the cryptocurrency platforms reviewed by NerdWallet.Indeed, Bitcoin and Ethereum are the two most valuable cryptocurrencies. This means that they are widely used and relatively well-established in this emerging field.

However, cryptocurrency traders often consider more options when buying or selling. Crypto.com, another leading cryptocurrency exchange, sells over 300 cryptocurrencies. Other brokerages also have more crypto options. For example, SoFi has about 20.

Fidelity may turn out to follow the same path as other brokerages, such as Robinhood, which started with a limited cryptocurrency offering and expanded over time.

Fidelity Crypto does not offer some of the advanced features available on competing exchanges. Staking, a process by which owners of some cryptocurrencies can earn rewards similar to interest, is not allowed.

Also, unlike other crypto exchanges, Fidelity Crypto does not offer 24-hour crypto trading and trading is limited to 4 a.m. to 12 a.m. Eastern Time.

Finally, the company states that it does not allow customers to transfer cryptocurrencies from their accounts or to external crypto wallets.

Transfers are very important if you want to do anything with your cryptocurrencies other than holding onto them in the hopes that they will increase in value. Cryptocurrency purchased through Fidelity is decentralized financial productsfor example.