Like ARK, Fidelity also modified its ETF proposal to match BlackRock’s.
Fidelity Digital Assets, the cryptocurrency arm of the $4.5 trillion asset manager, has resubmitted its application to launch a Bitcoin spot ETF in the United States.
Portions of the filing are nearly identical to separate filings by BlackRock and ARK Invest earlier this month.
Fidelity tries again
The proposal would allow the Cboe BZX exchange to list and trade shares of Fidelity’s Wise Origin Bitcoin Trust, according to a 19-b4 filing with the U.S. Securities and Exchange Commission (SEC) on Thursday.
Much like ARK on Wednesday, Fidelity first countered the Commission’s rationale for rejecting previous spot ETF applications, such as its own. The SEC’s main argument was that applicants have so far failed to secure supervisory sharing agreements (SSAs) with regulated markets of significant size, and CME Bitcoin futures don’t count.
“In each of the prior approval orders for commodity-based trust shares, there was a derivatives market that represented a regulated market of significant size, typically a futures market regulated by the Commodity Futures Trading Commission (“CFTC”),” the filing reads.
Still, the filing follows previous work by BlackRock and ARK, with CBOE proposing to enter into an SSA with “an operator of a U.S. bitcoin spot trading platform” that represents “a significant portion of U.S. bitcoin trade.”
James Seyffart, an ETF research analyst at Bloomberg Intelligence, released an informal estimate of the next SEC deadline to approve the ETF, predicting a date of September 2. Meanwhile, he expects ARK to list on August 13 and BlackRock to list on August 19.
No ETF risk
Fidelity added in its filing that failure to approve a spot Bitcoin ETF would expose investors to greater investment risk, not less.
“The lack of a spot Bitcoin ETP exposes U.S. investors’ assets to significant risk, as investors who would otherwise seek exposure to crypto assets through a spot Bitcoin ETP are forced to seek alternative investments through riskier means,” Fidelity said.
The firm cited FTX, Celsius, BlockFi, and Voyager as examples of such “alternative means” — all crypto firms that went bankrupt and froze customer assets last year amid market turmoil and active mismanagement/fraud.
Fidelity plans to serve as custodian of the fund’s bitcoin, while BlackRock plans to outsource that task to Coinbase.