Schwab to Add Bitcoin and Ethereum Trading—Crypto Uninsured
Charles Schwab will roll out direct Bitcoin (BTC) and Ethereum (ETH) trading to about 39 million brokerage clients via a phased “Schwab Crypto” launch. Trades will appear in the same Schwab app/account view as stocks and ETFs, aiming to make crypto exposure feel like a standard brokerage order.
Initial coverage is BTC and ETH only, roughly spanning three-quarters of total crypto market cap. Schwab will charge 75 bps (0.75%) per trade, executed and sub-custodied in the background by federally regulated infrastructure provider Paxos. Schwab also flags an important difference: the crypto sold is not a deposit and is not FDIC- or SIPC-insured, with principal potentially lost.
Schwab will exclude New York and Louisiana at launch and will disable transfers of outside crypto deposits/withdrawals—clients can only trade what they buy through Schwab.
For traders, this is a meaningful step for Bitcoin distribution into mainstream retail brokerage channels. But the higher 0.75% fee versus Spot BTC ETF purchase costs raises a potential “friction” debate, which may shift demand between direct spot trading and Spot BTC ETFs rather than simply expand total BTC inflows.
Neutral
Schwab’s move is a distribution upgrade for Bitcoin: direct trading inside a major US brokerage reduces “how to buy” friction and can broaden retail participation over time. The uninsured risk framework and restrictions on outside crypto transfers, however, limit how much this can change investor behavior during stress.
In the short term, the 0.75% per-trade fee is higher than typical Spot BTC ETF purchase costs, which may keep some price-sensitive retail demand tied to ETFs rather than shifting fully into direct spot trading. That fee gap is why the news reads as more about accessibility than immediate, margin-driving BTC inflow.
Longer term, if Schwab onboarding meaningfully increases retail participation, it could support liquidity and reduce distribution friction for BTC. But because the service introduces a different protection structure than traditional brokerage products, investor reaction during volatility could be more variable—supportive for spot demand in calm periods, but potentially less stabilizing under drawdowns. Net effect on BTC’s price is therefore best assessed as neutral rather than decisively bullish.