UBS Group AG (UBS.US) changing its attitude: considering opening up investments in Bitcoin and Ethereum to private banking clients.

UBS Group AG plans to open up cryptocurrency investments to some of its private banking clients. For the world's largest wealth management institution, this move could be a significant step towards entering the digital asset field. According to sources familiar with the matter, the Swiss banking giant, which manages around $4.7 trillion in assets, is currently selecting partners for its cryptocurrency business. The sources stated that discussions have been ongoing for several months, and because the deliberations are confidential, UBS Group AG has not made a final decision on how to proceed with the business. One source mentioned that UBS Group AG will initially allow specific clients of its Swiss private banks to trade Bitcoin and Ethereum. This service may later be expanded to markets in the Asia-Pacific region and the United States. The provision of access to cryptocurrencies signifies a significant shift in UBS Group AG's stance, as the bank has previously been cautious towards virtual tokens. Meanwhile, with the return of Trump to the White House, competitors on Wall Street such as JPMorgan Chase and Morgan Stanley are expanding their digital asset presence, putting pressure on UBS Group AG to follow suit. One source stated that UBS Group AG's increased focus on cryptocurrencies is partly in response to the growing demand for digital assets from its affluent clients. A spokesperson for UBS Group AG stated, "As part of UBS Group AG's digital asset strategy, we actively monitor industry developments and explore initiatives that reflect customer demand, regulatory dynamics, market trends, and robust risk controls. We recognize the importance of distributed ledger technologies like blockchain, which form the foundation of digital assets." Exploration in Blockchain Field Like many other global banks, UBS Group AG's previous efforts in digital assets have been primarily focused on building blockchain-based infrastructure for tokenized funds and payment services. Large lending institutions have been slow to enter fields such as cryptocurrency trading, largely due to the heavy capital rules under the Basel III framework. The United States has been leading efforts to revise these standards. The Basel Committee announced in November that it would accelerate the review of certain elements of the rules for banks holding crypto assets, paving the way for lending institutions to take new actions. UBS Group AG's deliberations also highlight the deepening level of institutional involvement in cryptocurrency, which is reshaping the industry. Since gaining approval two years ago, the U.S. cryptocurrency ETF led by BlackRock, Inc.'s iShares Bitcoin Trust has grown to nearly $140 billion in assets under management. Morgan Stanley is collaborating with cryptocurrency provider ZeroHash and plans to allow E*Trade customers to trade popular tokens like Bitcoin, Ethereum, and Solana starting in the first half of this year. As of December, JPMorgan Chase is also exploring cryptocurrency trading for institutional clients. Cryptocurrency trading has proven to be lucrative for some companies that have entered the field. Data shows that Robinhood Markets Inc. generated $626 million in cryptocurrency trading revenue in 2024, more than triple its stock trading revenue. In November 2024, UBS Group AG began offering cryptocurrency-linked ETF trading services to wealthy clients in Hong Kong, joining competitors like HSBC HOLDINGS. Former UBS Group AG Chairman Axel Weber, who was previously governor of the central bank, has long held a bearish view on Bitcoin. In late 2021, shortly after Bitcoin soared to new records, he stated that the concept of anonymous payments "will not survive."