The specific positive effects depend on the execution of Fidelity's acquisition of Grayscale and the application for spot ETFs, as well as the market's reaction. Investors should conduct their own due diligence before making decisions and take into account the risks and uncertainties of the crypto asset market. The following are just a few examples for reference:
Market compliance: As a globally renowned asset management company, Fidelity’s involvement may strengthen the regulatory and compliance measures for Grayscale and its products, thereby increasing market transparency and credibility. This may help reduce investor concerns and attract more institutional investors to the crypto asset market.
Product innovation: As an asset management giant, Fidelity has strong research and innovation capabilities. They may use the experience and resources of the acquisition of Grayscale to launch new crypto asset products to further meet the needs of investors. For example, they can develop more types of digital asset funds or derivatives to provide investors with more diversified choices.
Institutional recognition: Fidelity’s participation may bring more recognition and participation from institutional investors. Due to Fidelity’s reputation and scale, its participation may bring more institutional capital inflows to the crypto asset market, improving the market’s liquidity and maturity.
Marketing: As a world-renowned asset management company, Fidelity’s participation may attract more attention from the traditional financial community and media exposure. This will help popularize and promote the crypto asset market and increase investors’ awareness and understanding of this field.
What impact will it have on the market if the application is approved?
Increase market liquidity: The trading mechanism of ETFs enables investors to buy and sell underlying assets more conveniently, thereby improving market liquidity. As a large asset management company, if Fidelity applies for and successfully launches ETF products, it will provide investors with a more convenient and efficient investment tool, which is expected to increase market trading activity.
Expand the investor base: ETFs can usually be purchased by a wide range of investors, including individual investors and institutional investors. As a well-known global asset management company, Fidelity's ETF products may attract more investors to the market. This may include investors who are interested in the field of crypto assets but are not familiar with or convenient to participate directly, thereby expanding the overall investor base.
Improve market recognition: As a company with rich experience and reputation, Fidelity's participation in the crypto asset market and application for ETFs may further enhance market recognition. This may enhance market compliance and transparency and attract more institutional investors to participate. Investors' trust in Fidelity may be transmitted to the market, thereby increasing investor confidence and participation.
Increase market competition and innovation: As a large asset management company, Fidelity may face fierce competition with other competitors after participating in the crypto asset ETF market. This may prompt other companies to speed up their innovation and launch more attractive products and services to meet investor needs. Such market competition and innovation will help promote the further development of the entire market.
So does the rise of BTC and ETH in the past two days have anything to do with BlackRock and Fidelity’s application for ETFs?
Typically, major market events and news announcements may have an impact on the cryptocurrency market. As world-renowned asset management companies, BlackRock and Fidelity may have a certain impact on the market if they apply for and successfully launch cryptocurrency ETFs.
Such ETF applications and launches may increase the liquidity of the cryptocurrency market, attract more institutional investors, and improve the compliance and transparency of the market. These factors may have a positive impact on BTC prices and drive prices up.
It should be noted that the cryptocurrency market is affected by many factors, including supply and demand, investor sentiment, market liquidity, etc. Therefore, market volatility and price changes may not be directly related to the cause and effect of a single event, but the result of the combined influence of multiple factors.