A Major Asset Managing Firm Prepares to Make A Substantial Crypto Move
Fidelity, a leading asset manager, is reportedly preparing for a significant shift in the cryptocurrency space
Rumors are circulating that Fidelity, a prominent asset management firm, is poised to make a substantial move in the crypto sector, as per Andrew Parish, co-founder of Arch Public. Known for its interest in cryptocurrencies, the company has mined Bitcoin since 2014 and established Fidelity Digital Assets (FDA) in 2018.
FDA, which received a New York Trust Charter and initiated European operations in 2020, launched Fidelity Crypto that allows users to trade Bitcoin and Ethereum alongside conventional stocks. It also advocates for digital asset investing in 401(k)s.
Speculation suggests that Fidelity, the third-largest asset manager globally with $4.24 trillion under management, is eyeing either a Grayscale buyout or a Bitcoin spot ETF application. Parish contended that such moves, along with other recent developments, could lead to Fidelity and BlackRock dominating the US digital asset space.
Grayscale operates 17 cryptocurrency trusts and is the largest by assets under management (AUM) at $16.5 billion with its Bitcoin Trust (GBTC). These trusts provide accredited investors exposure to underlying crypto assets through trust shares and have SEC reporting obligations, offering robust investor protection. However, unlike a spot Bitcoin ETF, GBTC cannot be redeemed in BTC. Grayscale's bid to convert GBTC to a spot Bitcoin ETF was rejected by the SEC in June 2022, prompting a lawsuit.
BlackRock, the world's largest asset manager, submitted a Bitcoin spot ETF application on June 15, seen as a positive step for the crypto sector. However, doubts linger over the application's likely success and BlackRock's true intentions.
