UBS has been working on the plan for months, but one industry executive admits he is ‘still dubious about crypto and its true value.’
While clients in the United States can buy and sell exchange-traded funds that own crypto currency assets, UBS Group AG, the giant bank, is reportedly considering opening up crypto trading for its wealthy, private banking clients in its home base of Switzerland, according to a report by Bloomberg News.
Wealth management clients want to buy crypto assets. Giant, U.S. based wealth management firms like UBS, Merrill Lynch and Morgan Stanley are working to figure out how to give clients access to crypto assets while also working within regulations about such assets as mandated by the Securities and Exchange Commission.
Most large financial advice firms in the United States appear, so far, to have settled on selling crypto-backed ETFs to clients to meet their demand. UBS, of course, is a bit of a different animal: its base of operations is overseas, but it has a significant wealth management franchise in North America, as well.
“I’m still dubious about crypto and its true value, but I don’t know how this would work in the United States,” said one senior industry executive who spoke privately about the matter. “Broker-dealers don’t have access to the ledger technology of blockchain, which you need to support digital assets and to trade them.”
UBS has been working on the plan for months, according to Bloomberg News.
“The Swiss banking giant, which oversaw some $4.7 trillion in wealth assets as of Sept. 30, is in the process of selecting partners for a crypto offering, people with knowledge of the matter said,” according to the report. “Discussions have been ongoing for several months and UBS hasn’t made a final decision on how to proceed, they said, asking not to be named as the deliberations are private.”
“UBS would initially allow select clients of its private bank in Switzerland to buy and sell Bitcoin and Ether, one of the people said,” the report noted. “The offering may then be rolled out in markets like the Asia-Pacific region and the US, according to the person.”
When asked about the report, a UBS spokesperson in the United States said: “As part of UBS’s digital asset strategy, we actively monitor developments and explore initiatives that reflect client needs, regulatory developments, market trends and robust risk controls. We recognize the importance of distributed ledger technology like blockchain, which underpins digital assets.”
“Offering access to cryptocurrencies would mark a meaningful shift for UBS, which has long taken a cautious stance on virtual tokens,” according to the Bloomberg report. “At the same time, Wall Street rivals like JPMorgan Chase & Co. and Morgan Stanley are expanding in digital assets after Donald Trump returned to the White House, putting pressure on UBS to follow suit.”