Cryptocurrency News

Asset Manager Giant Fidelity Investments Launches Bitcoin Spot ETF in Canada

By December 2, 2021 No Comments

Fidelity, one of the biggest multinational financial services corporations globally, has launched its first-ever Bitcoin spot exchange-traded fund (ETF). Fidelity reportedly tried to launch the ETF in the US but to no avail.

Key takeaways:

  • Financial Times reports that the new fund, dubbed the Fidelity Advantage Bitcoin ETF (FBTC), was designed to invest directly into Bitcoin instead of BTC-based futures contracts.
  • Fidelity is the fourth largest asset manager in the world, with over $4.2 trillion in assets under management (AUM). For comparison, the biggest purely crypto-focused asset managing firm, Grayscale, has “only” $53.9 billion in AUM.
  • Fidelity has reportedly met with the Securities and Exchange Commission (SEC) officials earlier this year. Still, the firm was unsuccessful in its pursuit of securing a BTC spot ETF for the US market and its ETF application was put on indefinite hold.
  • The SEC has so far been unwilling to approve any of the BTC spot ETF applications for the US market. The regulator has been citing the potential for “fraudulent and manipulative acts and practices” as the reason for rejecting BTC ETFs.
  • During the last couple of months, three US-traded Bitcoin future ETFs were greenlighted for the launch in the US market –  Proshares’ BITO on New York Stock Exchange (NYSE), Valkyrie’s BTF on NASDAQ, and VanEck’s XBTF on Chicago Board Options Exchange (CBOE). 
  • Last month, Grayscale’s legal council openly criticized the SEC in a letter, pointing to the hypocrisy of allowing trading of derivatives of a particular asset but not “allowing investing in the asset itself.”
  • Purpose Investments launched Canada’s first “physical” bitcoin ETF (BTCC) in February to massive success. More than $1 billion poured into the fund within its first month of trading. Fidelity’s enters the market as the 23rd crypto Canada-traded crypto ETF. 
  • Kelly Creelman, senior vice-president, products and marketing at Fidelity Investment Canada, commented on the launch of the company’s first BTC ETF: “This product will offer investors exposure to an emerging technology, and including it in a traditional retail and institutional portfolio of stocks and bonds may be beneficial from a portfolio diversification standpoint.”