SoFi is adding bitcoin, litecoin and ether to its SoFi Invest platform through a partnership with Coinbase, allowing members to trade cryptocurrencies alongside their stock and ETF trades and, ideally, making more people more comfortable with buying crypto.

Members can track the prices of up to 40 other coins in real-time, a feature SoFi introduced earlier this year in partnership with Coinbase (which has a similar arrangement with Fidelity for its retail customers, although they can’t yet trade crypto yet).

SoFi Digital Assets will charge up to 1.25 percent on crypto transactions, according to its website. Members can trade up to $50,000 in a single order per day.

SoFi Crypto is currently in beta testing and is expected to launch this month. SoFi CEO Anthony Noto first teased the launch of Crypto in February when the company launched SoFi Invest (which also offers stocks, ETFs and robo-advising accompanied by newsy and educational content). But SoFi Digital Assets, the official name of the crypto affiliate, has been working to secure its individual state licenses for at least the past year, and is available in 36 states today and Washington DC.

In March it hired its product lead for Crypto, Albert Cheng, who joined after co-founding the crypto investing startup New Wave.

Crypto investing in digital banking apps

SoFi is the third digital finance company to begin offering crypto trading, after Square’s Cash App and Robinhood. The move signals increased demand by audiences of fintech apps that aren’t necessarily crypto native apps (like Coinbase, Circle or Blockchain) for new types of assets besides stocks and public companies. These fintech companies, regardless of their initial value proposition or their particular type of customer, are all looking to meet that demand.

“Users not currently demanding it will have easier access because they’re already using these services,” said Alex Adelman, CEO of the bitcoin rewards app Lolli, which lets users gain exposure to bitcoin without having to personally invest in it. “It’s a really big deal for the industry because [users of] these apps that are used by millions of people already as investment tools are going to see bitcoin and other digital assets alongside the stocks and assets they already know.”

SoFi, which made its name as a student lending company, says it has about 800,000 users today, although it’s hoping to become a household name over the next decade, if not sooner. It just bought the naming rights to the Los Angeles stadium, now called SoFi Stadium, that will be hosting Super Bowl LVI in 2022 and the Opening and Closing Ceremonies of the 2028 Olympics. By comparison, the stock-trading app Robinhood has 6 million users and Square’s money transfer service Cash App has 15 million users, according to its fourth quarter Shareholder Letter.

But the battleground will be outside of the U.S. and Europe, where people use cryptocurrencies to move money and get around local capital controls, said Bill Barhydt, CEO of cryptocurrency wallet and exchange app Abra. In the West, however, adoption of crypto will continue to be focused on investing – and there’s enough room for multiple digital finance players to offer crypto investing as a slice of their total services offering. Doing so could help make the concept less intimidating for everyday people, Adelman said.

“Investments feel a little scary to a lot of people and many wouldn’t consider themselves investors,” Adelman said. “So the more touchpoints people have with digital assets that make them feel similar to the things they’re already doing, the simpler it is to get into bitcoin.”

Barhydt sees two major camps emerging among U.S. crypto investors that show the level of intimidation in crypto investing is waning, which he credits to proactive self-education about opportunities in digital assets.

“There’s the millennial camp, which says this is a great hedge against the dumb stuff governments do to erode my future wealth and investments and that crypto represents a good long-term opportunity as a hedge against those things. Then there’s the older perspective from baby-boomer-investor types who may agree with that, but are just interested in getting outside investment returns,” Barhydt said.

Traditional banks inching towards irrelevance

As more fintech companies begin introducing crypto trading, traditional banks will eventually have to join the crypto ecosystem, Adelman and Barhydt both said. Banks have been publicly enthusiastic about the benefits of blockchain technology for private database tracking purposes as well as digital currencies, but have generally stood firmly against the idea of incorporating true cryptocurrencies like bitcoin, litecoin or ether.

“If people want digital assets and it’s 100 percent accepted that the current infrastructure of currencies will be replaced by digital assets — either in the form of stable coins or digitally backed assets — banks are going to have adopt holding the currencies,” Adelman said.

“As things grow exponentially over the next two or three decades, banks that aren’t playing a proactive role getting value into the ecosystem will be left in the dust and get to a point where they’ll say ‘We have no choice but to play in this ecosystem or we’ll reach irrelevance,’” Barhydt said.

Update: This story was updated September 24, 2019 to reflect that the SoFi Crypto platform is currently in beta testing.

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