Fidelity Enters the Bitcoin ETF Race

Asset manager giant Fidelity joined a slew of other firms vying for US Securities and Exchange Commission approval for a bitcoin exchange-traded fund Wednesday. 

Fidelity is hoping to launch the Wise Origin Bitcoin Trust, which will allow investors to gain exposure to the digital asset without actually holding the currency themselves, according to forms filed with the SEC Wednesday. The physical assets would be custodied by Fidelity Digital Assets, a branch of the firm founded in 2018, if the ETF is approved. 

The trust will track the performance of bitcoin, which will be measured by the Fidelity Bitcoin Index PR. Coin Metrics will be the calculation agent for the index.

“The digital assets ecosystem has grown significantly in recent years, creating an even more robust marketplace for investors and accelerating demand among institutions,” Fidelity said in an emailed statement. “An increasingly wide range of investors seeking access to bitcoin has underscored the need for a more diversified set of products offering exposure to digital assets.”

The SEC has never approved a digital asset ETF, but not for lack of options. Fidelity joins Goldman Sachs, SkyBridge Capital, NYDIG and VanEck, among others, in trying to launch a product geared toward retail investors who want exposure to digital assets without the risks associated with buying directly on an exchange. 

Last week Christine Sandler, head of sales and marketing at Fidelity’s digital assets subsidiary, spoke to Blockworks about the “tremendous” retail demand for cryptocurrency.

“We’d love to get more product in the hands of retail clients, even if [FDAS] cannot serve them at this time by offering them access to spot bitcoin,” she said. “We would love to have more people, more individuals, more families, more 401Ks exposed to digital assets and bitcoin is a really great way to start. And if folks need an ETF to kind of begin that journey, that’s great.”