Asset manager Fidelity Investments has submitted an application for a spot Bitcoin exchange-traded fund (ETF), becoming the seventh applicant this year. The filing, made through Cboe BZX Exchange with the United States Securities and Exchange Commission (SEC) on June 19, follows similar applications from BlackRock, WisdomTree, Invesco, and Valkyrie.
Fidelity’s renewed application for a spot BTC ETF highlights the significance of the CME Bitcoin Futures market as a regulated and sizeable market that reflects the spot bitcoin market. The proposal argues that the absence of a spot Bitcoin ETF exposes U.S. investors to substantial risks by forcing them to seek alternative, potentially riskier means of exposure to cryptocurrencies.
The trust’s custody of the Bitcoin assets would be managed by Fidelity Digital Assets Services, a regulated custodian licensed by the New York Department of Financial Services. As part of the application, Cboe BZX expressed its intention to establish a surveillance-sharing agreement with a U.S.-based cryptocurrency exchange.
Despite the increasing number of applications for spot BTC ETFs, the SEC has yet to approve a single one. Fidelity’s previous application, filed in March 2021, known as Wise Origin Bitcoin Trust, was rejected after an extended deliberation period. Fidelity, with its $11 trillion in assets under administration, aims to secure approval for its Wise Origin Bitcoin Trust product this time around.
This development indicates growing political pressure for the approval of a spot BTC ETF, which is seen as a significant milestone in expanding access to crypto assets within traditional investment vehicles. If approved, a spot BTC ETF would provide investors with a regulated and mainstream avenue for gaining exposure to Bitcoin.
Overall, the increasing number of applications for spot BTC ETFs demonstrates the industry’s belief in the potential of cryptocurrencies as an investment asset class. However, it remains to be seen when the SEC will grant approval for the first spot Bitcoin ETF, which could have far-reaching implications for the cryptocurrency market and its integration into the traditional financial system.