Fidelity, a leading player in asset management, took another opportunity to launch a spot Bitcoin ETF called the Wise Origin Bitcoin Trust. This comes shortly after a similar filing by BlackRock’s iShares unit, signaling a significant shift in the financial landscape.
CoinDesk revealed that Fidelity’s initial attempt to launch the Wise Origin Bitcoin Trust in 2021 faced resistance from the US Securities and Exchange Commission (SEC), dampening their efforts. However, BlackRock’s recent submission has revived interest in spot Bitcoin ETFs, with other fund firms such as Invesco and WisdomTree also joining the race.
Fidelity’s latest filing includes an undisclosed “share of custody agreement” with a US-based Bitcoin trading platform to address SEC concerns about market manipulation. This agreement aims to increase transparency and security in the trading process, protecting against potential manipulative practices.
Furthermore, Fidelity emphasizes the losses suffered by cryptocurrency participants due to bankruptcy of custodians and failure of centralized exchanges. The company argues that access to vehicles such as spot Bitcoin ETFs can protect countless investors from such losses, underscoring the urgent need for investor protection.
While the SEC’s decision on the new application is still pending, there is cautious optimism surrounding BlackRock’s filing. However, skepticism remains prevalent. Townsend Lansing, Chief Product Officer of CoinShares, estimates a 10% chance of approval for the BlackRock app, suggesting that the SEC may require the majority of Bitcoin trading to occur on US-based crypto exchanges to grant approval.
As the financial industry eagerly awaits the SEC’s decision, Fidelity’s new venture and BlackRock’s entry into the Bitcoin ETF space represents a significant paradigm shift. If this submission pave the way for spot Bitcoin ETF approval, it will no doubt reshape the investment landscape, open up new opportunities for investors and further legitimize the role of cryptocurrencies in traditional finance.