Monday, September 25, 2023

Fidelity Enters Spot Bitcoin ETF Contest With New SEC Filing -Dlight News

(Bloomberg) – Fidelity Investments is the latest financial services heavyweight to put its name in the running to offer the first U.S. exchange-traded fund that invests directly in Bitcoin.

The Boston-based wealth manager, which has about $11 trillion in assets under management and tens of millions of clients, has re-enrolled in the Wise Origin Bitcoin Trust, according to a document filed with the U.S. Securities and Exchange Commission on Thursday. Similar to previous US spot bitcoin ETF filings over the past few weeks, the updated filing states that Fidelity expects to close a deal Surveillance Sharing Agreement with a US cryptocurrency exchange.

It’s the latest high-profile traditional finance company to join the race after BlackRock Inc. caused a stir with its June 15 spot ETF filing, opening the floodgates for others to try as well. For crypto fans, it was a series of significant developments given BlackRock’s reputation on Wall Street and the view of some market watchers that the asset manager would not attempt it unless confident of receiving regulatory approval.

According to a tally by Bloomberg Intelligence, there have been around 30 attempts at a spot Bitcoin product. But the motions have met with opposition from regulators, who in the past have cited market concerns and a lack of investor protection, among other things. According to a Fidelity spokesperson, Fidelity originally applied for the Wise Origin Bitcoin Trust in 2021, which the SEC denied in January 2022.

Nonetheless, BlackRock’s move inspired a number of similar filings from other issuers including Invesco Ltd., WisdomTree, Valkyrie and Bitwise. Meanwhile, Cathie Wood’s ARK Investment Management has said it believes it could be the first company to receive potential regulatory approval. ARK resubmitted its application in April along with crypto issuer 21Shares.

Read the previous coverage:Cathie Wood’s ARK says it’s first in line for spot bitcoin ETFTiny issuer features only US double bitcoin futures ETF

Digital asset fans are excited at the prospect of cryptocurrencies potentially becoming more accessible to regular investors, and the spate of filings has had a positive impact on token prices. Bitcoin bounced back above $30,000 in June, trading at its highest level in about a year. The token was trading at around $30,500 on Thursday. That’s still less than half of the record high of nearly $69,000 set in November 2021.

Of course, this isn’t the first cycle of hype about a potential launch. Crypto fans, who have been craving a spot Bitcoin ETF for years, have had periods of excitement before, but regulators have ultimately dismissed all attempts.

While BlackRock’s filing was seen by observers as helping push Bitcoin’s price to a yearly high last week, the market’s reaction to Fidelity’s re-filing was rather muted. Bitcoin is up about 1.5% to $30,500 as of 2:25 p.m. in New York, albeit below the daily high.

– With support from Tom Maloney.

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