Charles Schwab is Launching Direct Bitcoin Trading. The Era of Mainstream Crypto is Here.

Not too long ago, discussing bitcoin in a Charles Schwab branch would have resulted in a courteous smile and a referral to a balanced index fund. The company has always presented itself as the responsible older sibling of American finance, with its beige-and-blue branding and trillions of client assets. Be careful. measured.

Anything that smelled like speculation made me a little allergic. Therefore, the announcement that Schwab is now offering direct bitcoin and ether trading through a service called Schwab Crypto feels more like a subtle acknowledgement that something has changed than a formal announcement.

The mechanics are fairly simple. The same platform that customers use to buy and sell stocks will also be used to buy and sell bitcoin and ether, with a 0.75% fee for each transaction. The digital assets will be kept in a different account from the rest of a client’s holdings, presumably to allow the compliance team to sleep at night. Paxos will be in charge of custody. In the upcoming weeks, the service will launch. It’s a product launch on paper. In reality, it’s more akin to a cultural capitulation.

For months, Schwab’s CEO, Rick Wurster, had been hinting at this change. He told CNBC back in July that his clients frequently told him the same thing: they had almost all of their money at Schwab, but they were keeping one or two percent at a “digital native firm” because they had nowhere else to store their cryptocurrency. They desired to take it home. It’s a minor but significant detail. The clients were ahead of the company. They had already determined that cryptocurrency should be included in a legitimate portfolio. Schwab had only recently caught up.

The key phrase is “catching up.” Since 2013, which is roughly the Pleistocene era in terms of cryptocurrency, Fidelity, Schwab’s more subdued and possibly more agile competitor, has been involved. Fidelity added Solana trading last fall, opened 401(k) plans to bitcoin in 2022, and released a free cryptocurrency trading app in 2023. Allowing younger investors to trade stocks and cryptocurrencies with a single swipe is the foundation of Robinhood. The native cryptocurrency exchanges, Coinbase and Kraken, have been heading in the opposite direction, taking up commission-free stock trading and discreetly evolving into full-service brokerages. It’s becoming difficult to distinguish who is intruding on whom because the lines have become so hazy.

The size of the organization behind the Schwab move is what gives it a unique feel. You don’t think of eleven trillion dollars in client assets as being associated with experimentation. When a company of that size eventually makes a move, it’s typically because the risk of staying put has outweighed the risk of moving. It is evident that conditions on Wall Street have loosened as a result of the Trump administration’s more accommodative stance toward digital assets. Morgan Stanley launched its Bitcoin Trust, Goldman Sachs filed for a bitcoin income ETF, and even Bank of America, a longtime cryptocurrency holdout, is now encouraging customers to make modest investments through ETFs. If there was ever a dam, it is no longer there.

It wasn’t exactly a parade of investors. Schwab’s stock fell 5% on Thursday, but this was less due to concerns about the cryptocurrency news and more to a weak first-quarter revenue report. Observing all of this gives me the impression that the days of viewing bitcoin as a sideshow are over. It’s still unclear if that’s a good thing or just an inevitable one. However, the ushers are now dressed in suits, and the sideshow has obviously taken center stage.