🌎 Fidelity Digital Assets Reports £7M Loss Amid Revenue Decline

Crypto custodian service Fidelity Digital Assets experienced a significant drop in revenue in 2023, with losses reaching over £7 million.

Fidelity Digital Assets: Revenue Decline

Fidelity Digital Assets, launched in 2018 to expand Fidelity’s crypto services, generated revenue of £545,000 (approximately $695,000) over the past year. This marks a 59% decline from £1.34 million in 2022. This data is based on documents filed by Fidelity with Companies House.

Increased Operating Expenses

In addition to decreased revenue, operating expenses surged by 32% year-on-year to £7.8 million in 2023. This increase was largely driven by higher staff salaries. Overall, Fidelity Digital Assets reported a loss of £7.1 million for 2023, up nearly £5 million from £2.5 million in 2022.

Future Revenue Projections

Addressing the losses, Fidelity mentioned that revenue is “forecasted to grow upwards with increasing business activity in custody and trading services, as additional new clients are expected to be onboarded.” The decline in revenue has been attributed to a drop in service-level agreement fees.

Leadership Changes

In early 2023, Fidelity lost its crypto chief Chris Tyrer, who had led the company’s efforts in the crypto space since 2019 as head of Europe. Tyrer joined Bullish, a crypto exchange backed by Peter Thiel, as head of strategy in late May.

Additionally, in mid-May, Synnax, an AI-powered financial platform for credit analysis and ratings, onboarded ex-Fidelity International head of digital assets Luc Froehlich as its new chief commercial officer to lead the firm’s commercial strategy and operations.