Why Fidelity Wants to Offer a Bitcoin Spot ETF?

Following the example of BlackRock, another prominent asset management company has decided to pursue a Bitcoin spot exchange-traded fund (ETF) to cater to the increasing demand for crypto investment products from both institutional and retail investors. 

A confidential source revealed that Fidelity Investments applied to the United States Securities and Exchange Commission (SEC) to create a Bitcoin ETF with a similar structure to BlackRock’s, which would enable investors to gain exposure to the digital asset without directly owning it.

The ETF would mainly rely on physically-backed Bitcoin futures contracts, offering a more regulated and accessible investment vehicle for conventional market players.

Fidelity Investments is considering launching a Bitcoin ETF in the United States, reflecting the growing interest and acceptance of cryptocurrencies by traditional financial institutions. With over $10 trillion in assets under management, Fidelity’s entry into the Bitcoin ETF space would bring great credibility and legitimacy to the cryptocurrency market, potentially attracting a new wave of institutional investors.

Fidelity Continues to Grow Its Presence in the Crypto Scene

The company already offers various crypto products to its investor base. It’s worth noting that Fidelity Investments was the first to offer investors the opportunity to include crypto assets in their 401(k) retirement accounts. Also, in December 2021, the company launched the Fidelity Advantage Bitcoin ETF in Canada.

To top it off, the company opened Bitcoin and Ether trading access to all of its retail merchants in March 2023, further expanding its offerings in the crypto space.

The prospect of a Bitcoin ETF has been eagerly anticipated by many Bitcoin enthusiasts, as it could potentially attract huge institutional investment, pushing the price of the digital currency to new levels. Furthermore, the launch of a Bitcoin ETF could also address some of the issues around market manipulation and investor protection.

One should keep in mind that the news regarding Fidelity’s Bitcoin ETF filing and the possible purchase of Grayscale is not verified yet. A Bitcoin ETF is a complex financial product that requires thorough examination from regulators such as the Securities and Exchange Commission (SEC). The approval process and the launch date of such a product can vary depending on various factors.