Fidelity’s Bitcoin ETF Update Sparks SEC Clash

Fidelity Investments, a leading ETF issuer with $37 billion in 58 ETFs, has resubmitted its application to the U.S. Securities and Exchange Commission (SEC) for its Bitcoin spot ETF “Wise Origin Bitcoin Trust”. The revised proposal aims to address the concerns previously raised by the regulator when rejecting the update for the Bitcoin ETF.

Fidelity’s Bitcoin ETF Update

The update on the Bitcoin ETF would enable investors to easily buy and sell shares of a fund that mirrors the price of Bitcoin. They wouldn’t need to possess or protect the cryptocurrency themselves. This convenient solution offers institutional investors a safer means to engage with the booming yet volatile crypto market.

Fidelity’s decision underscores their belief in the long-term sustainability and expansion of digital assets. Additionally, it responds to the growing demand from clients seeking diverse and innovative investment options.

Abigail Johnson, CEO of Fidelity Investments, has been an outspoken advocate for integrating cryptocurrencies into traditional finance. She aims to enhance accessibility for investors by making digitally native assets like Bitcoin more readily available.

A Challenge for SEC

The Securities and Exchange Commission has been reluctant to approve any Bitcoin exchange-traded funds due to concerns surrounding market manipulation, fraud, custody, and investor protection. Multiple applications from firms like VanEck and Valkyrie have faced rejection or delayed decisions.

However, Fidelity’s Bitcoin ETF proposal holds potential for SEC approval as it boasts a strong reputation and ample resources. The updated proposal addresses the SEC’s concerns by offering enhanced transparency, liquidity, and security for the Bitcoin ETF.

Fidelity’s Bitcoin ETF Update Impact

The crypto community eagerly anticipates the outcome of Fidelity’s Bitcoin ETF update. Its approval could potentially bring in institutional investors and drive mainstream adoption, resulting in increased demand and prices for Bitcoin and other cryptocurrencies.

Conversely, if rejected, it may stifle the enthusiasm of crypto investors, leading to a decline in market sentiment and value. The update is expected to fuel a clash between the SEC and the crypto industry as they debate the future of digital asset investment.

The market is recovering from the fake news of BlackRock’s iShares Spot BTC ETF approval on 16 Oct. This event resulted in over $1 billion in total open interest being wiped out, with approximately $80 million in short positions liquidated and around $18 million in longs.

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Kashif Saleem

Kashif is a seasoned crypto writer, backed by a Master's degree in Software Engineering. He has been head-over-heels for cryptocurrencies since 2019, diving deep into the Cryptoverse and has authored more than 1k articles on cryptocurrency and blockchain. Follow him on X & LinkedIn or reach him at [email protected].

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