Fidelity Submits Proposal For For Bitcoin ETF
Fidelity Investments has filed a Bitcoin ETF proposal with the Securities Exchange Commission (SEC) as it looks to solidify its clout in the Bitcoin space.
The legacy investment giant filed the proposal for The Wise Origin Bitcoin Trust (The Trust) yesterday with the SEC through its subsidiary FD Funds Management.
And with a blockchain-friendly SEC chair Gary Gensler set to take over, who would bet against the commission handing the rights of launching a Bitcoin ETF to one of its most trusted institutions?
The Fidelity Bitcoin ETF (The Trust)
According to the filing, The Trust will track the performance of Bitcoin, as measured by the performance of the Fidelity Bitcoin Index PR, a barometer the investment giant established to track the price of the digital currency.
The Index is designed to reflect the Bitcoin to USD price ratio, and The Trust will hold Bitcoin and will value its shares daily.
The custodian will be another arm of Fidelity: Fidelity Digital Asset Services, LLC, who will oversee the buying and selling of any bitcoins as and when The Trust sees it necessary.
‘The digital assets ecosystem has grown significantly in recent years, creating an even more robust marketplace for investors and accelerating demand among institutions,’ says Fidelity. ‘An increasingly wide range of investors seeking access to bitcoin has underscored the need for a more diversified set of products offering exposure to digital assets.’
It’s Not Fidelity’s First Foray into the Bitcoin Space
The Bitcoin ETF filing is Fidelity’s latest of many products it offers in the Bitcoin space. The financial giant, which has over $7.5 trillion AUM and services over 13,000 institutions every day, has actually been involved in the Bitcoin space since it started mining Bitcoin back in 2015.
Fidelity launched its subsidiary Fidelity Digital Assets in 2018 and has since launched the Wise Origin Bitcoin Index Fund – a fund with a minimum $100,000 buy-in and also runs an enterprise grade custodial service for digital assets.
It’s expected that a name as renowned as Fidelity offering Bitcoin products is enough to draw clients ranging from institutional investors such as hedge funds and family offices.
And it’s just the beginning. Fidelity’s rivals will be making moves in the Bitcoin space, too, as institutional demand for Bitcoin gains pace.
Institutional Demand Will Make SEC Take Action
Institutional clients would always previously have avoided the likes of Binance and other cryptocurrency exchanges before, but with Fidelity starting to offer enterprise-grade products, they are being enticed into the space.
A Fidelity Bitcoin ETF is likely to be approved, as well. With Gary Gensler soon to take over the helm at the SEC, there will be someone who understands Bitcoin and blockchain.
The institutional demand for Bitcoin is clear for everyone to see and ease of access will be paramount, especially as Canada now has three Bitcoin ETFs.
The SEC will be watching the success of Canada’s Bitcoin ETFs and will be looking to launch one sooner rather than later. And who does the SEC trust more than Fidelity?