The CEO of Fidelity Investments, Abigail Johnson, said in an interview that the company would launch a Bitcoin ETF with crypto-friendly Canada as its home base. The move is just one step towards cryptocurrency mainstream adoption and could be followed by other financial institutions looking to provide access for investors.
The “bitcoin etfs” is a new product that will be launching in Canada. It is not yet known what the future of this product will be, but it could lead to more opportunities for investors.
According to Eric Balchunas, Senior ETF Analysts at Bloomberg, who broke the story on Twitter, Fidelity Investments will debut its spot Bitcoin ETF in Canada this week.
The Boston-based international financial services business will debut its new Bitcoin spot-based ETF on the Toronto Stock Exchange as the US Securities and Exchange Commission (SEC) fights similar products.
Balchunas, who evidently was unaware of Fidelity’s intentions, tweeted, “Semi-schock.” Fidelity “will easily be the largest asset manager to date with a Bitcoin ETF,” he claims.
Fidelity is introducing a spot bitcoin ETF in Canada this week, which is a semi-shock. I had no idea about this. With a bitcoin ETF, it will easily be the largest asset manager to date. pic.twitter.com/H2XJRBY3O6
30 November 2021 — Eric Balchunas (@EricBalchunas)
The Fidelity Advantage Bitcoin ETF (FBTC), which will be actively managed, will have a ticker of FBTC. Unlike futures-based ETFs, the fund will acquire Bitcoin directly rather than via a derivative instrument.
The SEC authorized three Bitcoin futures ETFs earlier this year — from Valkyrie, ProShares, and VanEck – but has been hesitant to approve a pure-play Bitcoin ETF.
The Securities and Exchange Commission recently denied VanEck’s application for a spot Bitcoin ETF, citing concerns about the product’s volatility and a lack of confidence in the fund’s capacity to prevent fraudulent trading and safeguard investors.
“This should be humiliating for the SEC,” Balchunas said, “that one of America’s largest and most historic companies in investment is obliged to travel up North to service its customers.”
In terms of creative ETFs, he said that Canada has always been ahead of the US.
“They’re going to have like a three-year head start,” the expert said, noting that Canada has been more receptive of Bitcoin in TradeFi than the United States.
Awaiting the SEC’s decision
Grayscale Investments lawyers wrote to the SEC after the agency rejected VanEck’s petition for a spot ETF, arguing the agency’s action violated the Administrative Procedures Act (APA).
While the SEC’s approval of futures ETFs indicated that the agency is warming to crypto as an investable asset class, the agency’s stance on spot ETFs dashed optimism.
“The Commission’s threshold for allowing the listing of spot Bitcoin ETFs is arbitrary and, in fact, difficult to achieve,” according to Grayscale.
The SEC’s refusal to approve Bitcoin spot ETFs demonstrates the agency’s irrational and inconsistent attitude to crypto regulation. https://t.co/qnKkVoeQ3t
30 November 2021 — Tom Emmer (@RepTomEmmer)
On Twitter, Minnesota Congressman Tom Emmer said, “Withholding licenses for Bitcoin spot ETFs just exposes the SEC’s bogus & wildly inconsistent approach to regulating crypto.”
Emmer questioned the SEC’s discriminatory argument against Bitcoin spot ETFs with Congressman Darren Soto, stating that futures ETFs are “possibly” more volatile since they may impose higher fees on investors.
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