Charles Schwab announced it will launch direct trading for bitcoin and ether through a new division called Schwab Crypto, marking the brokerage's entry into the cryptocurrency market and positioning it in direct competition with platforms like Robinhood. The new service will allow Schwab clients to buy and sell bitcoin and ether alongside their other investments, with the capability set to become available in the coming weeks [1].
Schwab, which manages over $11 trillion in client assets, cited strong client interest in crypto investing as a key driver for the move. Jonathan Craig, head of retail investing at Charles Schwab, stated, "With Schwab Crypto, clients who want direct access to the asset class can trade it alongside their other investments, while benefiting from the service, education, and research they expect from us" [1].
The company will charge a 0.75% fee on every crypto trade, in contrast to Robinhood's commission-free model and Coinbase's variable fees. Schwab is partnering with Paxos for custody services, ensuring that crypto funds are held in a separate Schwab account distinct from the main brokerage account [1].
The announcement comes amid a broader trend of traditional financial institutions embracing digital assets, a shift attributed in part to the Trump administration's favorable regulatory stance toward the crypto industry. Following the news and the release of Schwab's quarterly financial results, shares of Charles Schwab fell by 2% on Thursday [1].
CONCLUSION
Charles Schwab's entry into direct crypto trading signals a significant shift in the traditional brokerage landscape, intensifying competition with platforms like Robinhood. The move reflects growing mainstream acceptance of digital assets, though initial market reaction was negative, as evidenced by a 2% drop in Schwab's share price.