Fidelity Investments on the Verge of Filing Bitcoin ETF Application

Fidelity Investments on the Verge of Filing Bitcoin ETF Application

Fidelity
Investments, one of the largest mutual fund companies in the US, might be
closer to filing an application for approval of their own spot Bitcoin (BTC)
exchange-traded fund (ETF). Speculations, which first appeared almost two weeks
ago, have been confirmed by a source familiar with the company’s plans, The
Block reported yesterday (Tuesday).

Fidelity Joins the Bitcoin
ETF Race

More large
companies joined the race after BlackRock filed its own application to
establish a spot Bitcoin ETF on 15 June. Invesco, WisdomTree, and Bitwise have
also submitted their inquiries.

For some
time now, there has been strong speculation that Fidelity Investments would
take a similar step, as it had already presented similar plans in 2021.

Although it was unsuccessful two years ago and the application was finally
rejected in early 2022 by the Securities and Exchange Commission (SEC), the
company reportedly made another attempt.

The
Block claims that
the sources familiar with the matter suggested the possibility of filing such
an application this week. However, Fidelity refused to comment on these rumors.

Interestingly,
ARK Investment Management had submitted a similar application to the SEC long
before BlackRock filed its own spot Bitcoin ETF application. The fund, owned by
famous investor Cathie Wood reported this in April.

Cryptocurrency ETFs
Attract Record Amounts of Cash

Applications
from companies such as BlackRock, WisdomTree, Invesco, and supposedly Fidelity
have sparked a new fever in the digital assets market. Wall Street giants seem
to be trying to grab a piece of the cryptocurrency pie since the United States has dealt with 'unregulated’ exchanges like Binance and Coinbase.

The price
of Bitcoin has bounced back by over 25% in a week, testing new annual highs and
growing by 80% since the start of the year. However, network activity does not
show either an increase in new users or higher volumes. The recent move was
purely speculative and resulted from a record inflow of cash into existing
cryptocurrency ETFs.

While the
SEC has not agreed for years to create a spot Bitcoin ETF, it has allowed trading
exchange-traded funds based on the valuation of crypto futures contracts. One
of the first was ProShares’ BITO Bitcoin, which is mainly popular among
institutional investors.

According
to the latest data, BITO received an additional $65.3 million in just one week.
Last Friday, the fund traded 500 million shares, one of the five best results
in its history.

However,
the growing popularity of regulated cryptocurrency instruments might not please
Bitcoin’s creator, the anonymous Satoshi Nakamoto. Bitcoin was supposed to be
an alternative to the world of traditional finance. Nevertheless, the latest
events show that its price has been rising in recent weeks solely thanks to
'old economy companies.

This article was written by Damian Chmiel at www.financemagnates.com.

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