Swiss-Based UBS Plans Digital Currency Offerings to Wealthy Clients

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In Brief
  • UBS Group is planning on offering digital currency investment to its wealthy clients.

  • The firm is looking into several alternatives, fearing it may lose clients if it fails to offer crypto investments.

  • An increasing number of investment firms are considering offering crypto assets.

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Swiss financial services firms UBS Group is planning on offering digital currency investments to its wealthy clients.

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According to sources familiar with the plan, UBS is looking into several alternatives for cryptocurrency investment offerings. For instance, one option includes investing through third party investment vehicles.

Due to cryptocurrency markets’ volatility, any potential investment would be an extremely marginal portion of clients’ total wealth. The firm feared it could lose clients, if it failed to respond to increasing demand for crypto investments.

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Crypto for the wealthy

At a conference last week, CEO of local rival Julius Baer Group, Philipp Rickenbacher, spoke about his own company’s consideration about crypto investments. He said the wealth manager was considering working with partners to offer clients access to crypto assets. However, he added that it didn’t plan on executing its own bitcoin (BTC)-related transactions for the time being.

Meanwhile, UBS has said that beyond cryptocurrencies, they are also intrigued by the potential of blockchain technology:

“We are monitoring the developments in the field of digital assets closely. Importantly, we are most interested in the technology which underpins digital assets, namely the distributed ledger technology.”

AI and digitization

Beyond cutting costs, UBS CEO Ralph Hamers is also focusing on where the firm can digitize its operations. For example, he wants to use artificial intelligence to better target products for its wealthiest clients. Hamers is also changing the way the bank spends on technology projects.

Instead of fixed funding on a yearly basis, the UBS CEO is switching to a more flexible quarterly allocation. The bank spends roughly $3.5 billion per year on technology, to both maintain and modernize its existing infrastructure, as well as develop innovative tools for employees and products for clients.

Other investment firms have recently taken the plunge into crypto investments, or are seriously considering it. Goldman Sachs announced that it aims to offer investments in digital assets in the second quarter of this year. The investment bank said it will ultimately offer a “full-spectrum” of investments in bitcoin and digital assets. Meanwhile, Citigroup said it is seriously considering offering crypto-related services.

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Nick is a data scientist who teaches economics and communication in Budapest, Hungary, where he received a BA in Political Science and Economics and an MSc in Business Analytics from CEU. He has been writing about cryptocurrency and blockchain technology since 2018, and is intrigued by its potential economic and political usage. He can best be described as an optimistic center-left skeptic.

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