Stash Investment App Expands Access to Crypto

Banking and investment platform Stash on Tuesday announced expanded user access to cryptocurrencies through a separate crypto account for its 2 million users, with the ability to purchase eight cryptocurrencies, including Bitcoin, Ethereum and Bitcoin Cash.

“We see this as an opportunity for growth [for users] to be able to invest and gain exposure to this growing asset class,” said Douglas Feldman, Chief Investment Officer of Stash. “We have a very strong long-term vision…that crypto and the blockchain technologies that crypto relies on will become more mainstream.”

The announcement comes nearly a year after the company introduced crypto exposure to its managed Smart Portfolio accounts. Despite the volatility in the crypto market, buying crypto directly through Stash – a customer-requested feature – is a longer-term game to help users build wealth over time through various wallets, Feldman said.

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Stash partners with Apex Crypto, which will act as custodian. Stash joins a growing number of traditional financial services companies expanding their reach into crypto this year. Fidelity Investments considered allowing individual investors to trade Bitcoin on its brokerage platform, The Wall Street Journal reported last month.

“We try not to focus on downturns and focus on some of the long-term indicators,” said Tom Jessop, president of Fidelity Digital Assets, said recently the Moving Journal.

The ability to buy crypto directly through Stash suits users who want a more hands-on approach to building their wallets, said Claudio Esposito, senior vice president and product manager at Stash.

Stash said it recommends users make crypto a relatively small proportion of their asset mix, and offers a calculator and in-app alerts that warn when they have too much exposure to crypto. against their risk profile. Clients should also read the educational material before investing in crypto, the company said.

Although customers can purchase crypto through the Stash platform, they will not be able to send the crypto they purchase through Stash to an external wallet. Stash said he is open to activating this ability in the future, but has no plans to do so at this time. (Robinhood investment app, by comparison, understand the ability to transfer crypto to and from Robinhood crypto accounts and recently spear a non-custodial crypto wallet.)

The ability to buy crypto through Stash represents the first product offering on its new central system, which launched last month. The company is ending its use of the core Green Dot system, a move it says gives it more control over product offerings.

“When we started we weren’t sure what we were going to do in banking at the time and the best thing for us was to have an all-in-one partner who provided us with everything we needed,” Esposito said. “As we evolved and grew…what we wanted was more control over the experience and more control over the infrastructure, and that’s just not the type of offering that Green Dot offers today.”

Stash, which is would have valued at $1.4 billion, said it has $3 billion in assets under management and $125 million in annual revenue.

Adding crypto will help Stash acquire and retain customers, said fintech industry analyst Grant Easterbrook. For existing customers, crypto could be a tool to build engagement within the platform rather than seeking those deals elsewhere, he noted.

“Potential customers often compare and contrast features when choosing a provider, and not offering crypto trading would have become an increasingly significant shortcoming if Stash didn’t offer it,” he said.

While educational tools can help introduce new customers to crypto, the inability to transfer crypto and out of the Stash platform can present longer-term challenges, he said.

“The major centralized crypto exchange alternatives that Stash customers might consider for crypto trading all offer the ability to send crypto to and from their platforms,” he said. “To compete in this industry, Stash will one day need to offer customers the ability to send and exit crypto.”

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Stash Investment App Expands Access to Crypto

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