Fidelity Investments resubmitted its application for its spot Bitcoin exchange-traded fund (ETF), named Wise Origin Bitcoin Trust, on June 29.
Fidelity first filed its application in 2021, but was rejected by the SEC in January 2022, along with other mock Bitcoin ETF filings. To date, no institution that has submitted a spot Bitcoin ETF application has received approval.
However, a wave of institutional interest appears to have been sparked by BlackRock’s mock Bitcoin ETF. Fidelity is the latest to join a wave of such re-applications sparked earlier in June by BlackRock’s own filing.
As of June 29, nine pending applications for a spot Bitcoin ETF have now been filed with the SEC. The other applications were filed by Ark Invest, 21Shares, Bitwise, WisdomTree, Invesco, Valkyrie and VanEck.
All of the companies’ applications — with the exception of BlackRock — have been rejected by the SEC for the past two years. BlackRock itself has a long history of ETF approvals – with 575 ETFs approved and only one ever rejected – leading markets to be optimistic that this application will also be approved.
The SEC has maintained that a product with direct exposure to Bitcoin is unsafe for investors because there are insufficient guardrails to prevent market manipulation. However, according to Evolve ETFs chief investment officer Elliot Johnson, the key differentiator in BlackRock’s filing is a supervisory agreement that allows its trading activities to be monitored by NASDAQ. This level of oversight, Johnson claimed, is what can effectively prevent such manipulation.
Courts have overruled the watchdog’s reasoning in the Grayscale v. SEC case called into question and called logic flawed for allowing ETF based on Bitcoin futures. However, as the case has yet to be finalized, it is unclear whether it will affect current attitudes towards a spot ETF.
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