This would be Fidelity’s second attempt to create such a product. In 2021, the company applied for a bitcoin spot trading fund called Wise Origin Bitcoin Trust, but the SEC rejected the company in early 2022.
The launch of a bitcoin spot ETF could give investors access to the market without having to deal with the underlying asset. Fidelity has tens of millions of retail brokerage clients and $11 trillion in assets. The firm is also familiar with the crypto industry – it has been involved in institutional custody and marketplace trading services since 2018.
Recall that in early June, BlackRock applied to launch iShares Bitcoin Trust. The paper stresses that previously approved products traded on the spot exchange in the commodities and foreign exchange markets “are generally unregulated, and the SEC relies on the futures market.”. Therefore, the company sees no obstacles to approving such a spot ETF.
The SEC was soon hit with five applications to launch spot cryptocurrency exchange-traded funds. Following BlackRock, four other firms applied: Fidelity, Invesco, Wisdom Tree, and Valkyrie.