Fidelity's Spot Bitcoin ETF Amendment Adds To Optimism Over Regulatory Approval

Fidelity’s Spot Bitcoin ETF Amendment Adds To Optimism Over Regulatory Approval

Updated: 18 October 2023

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Fund management giant Fidelity filed an amendment for its proposed spot Bitcoin ETF (exchange-traded fund), helping buoy sentiment about regulatory approval for the new class of investment vehicles.

The changes include how its ETF, called Wise Origin Bitcoin Trust, will protect customers’ Bitcoin in their accounts and inform investors about risks.

The filing to the U.S. Securities and Exchange Commission (SEC) on Oct. 17 follows recent amendments made by Ark Invest and Invesco that highlight their efforts to comply with regulatory requirements.

The filings show the companies are engaging in ongoing discussions with the SEC staff in order to ensure that their application includes the necessary information for potential approval.

These are ”positive signs,” tweeted James Seyffart, a research analyst at Bloomberg Intelligence.

More proof that potential spot #Bitcoin ETF issuers are in communication with SEC regarding changes/amendments required for SEC to consider approving. Positive signs IMO https://t.co/2LYU5aTlyJ

— James Seyffart (@JSeyff) October 17, 2023

Filings May Highlight Areas Of Interest To SEC

The filings are providing clues into what the SEC may look for when approving ETFs. The amendments focus on aspects including how cryptocurrencies are managed effectively during major network updates (known as hard forks), applying methods to determine the value of assets while following accepted accounting principles (GAAP), and offering detailed information about regulatory uncertainties.

They also acknowledge the energy-intensive nature of cryptocurrency mining and address the risks associated with potentially illegal transactions.

Spot Bitcoin ETF Approvals To Add $1 Trillion Market Cap

If spot Bitcoin ETFs are approved, it may add $1 trillion to the overall cryptocurrency market capitalization, which currently stands at $1.1 trillion, said CryptoQuant.

The Next Wave of #Bitcoin Institutional Adoption:
The Launch of Spot ETFs

– SPOT ETFS AS THE NEW WAY OF INSTITUTIONAL ADOPTION.
– IMPLICATIONS OF ETF APPROVALS FOR BITCOIN MARKET CAPITALIZATION.

Prepared by Our Head of Research, @jjcmoreno.

Link👇https://t.co/dKyd5GJJdT pic.twitter.com/ECEWMpkf0g

— CryptoQuant.com (@cryptoquant_com) October 16, 2023

Bitcoin is up almost 6% in five days as optimism grows over the approval of spot Bitcoin ETF.

The regulator is under pressure to approve the ETFs after Grayscale Investments won a court victory against it in late August. The judge called the regulator’s decision to approve Bitcoin Futures ETFs, but not spot Bitcoin ETFs, ”arbitrary and capricious.” When the SEC decided not to appeal the decision, it further shortened the odds for approval.

Former BlackRock director Steven Schoenfield says spot Bitcoin ETFs may be approved as early as January, and that they may attract as much as $200 billion to Bitcoin investment products.