Fidelity Joins Race For A Spot Ethereum ETF
Fidelity, a major asset management firm with over $4.5 trillion in assets under management, has officially submitted an application to create a Spot Ethereum exchange-traded fund (ETF).
This decision follows recent actions taken by BlackRock, an asset management company, which submitted its application for Ethereum exchange traded fund (ETF) last week.
Fidelity is 7th on the list
Fidelity Investments recently positioned itself as the seventh asset management company in the United States to offer the aforementioned product.
Based on Form 19b-4 filed with the SEC, the Fidelity Ethereum ETF is called the “Fidelity Ethereum Fund” and is designed to track the performance of Ethereum. If approved, the ETF will trade under the BZX Rule, the company revealed.
Update: @Loyalty joins the spot #Ethereum Course ETF by filing a 19b-4 with @CBOE https://t.co/rxNEzpzh3g pic.twitter.com/o96XspPDEP
–James Seyffart (@JSeyff) November 17, 2023
Each share will reflect a portion of the undivided beneficial interest in the net assets of the Fidelity ETH Fund, the registration statement said. The ETH held by the New York Department of Financial Services on behalf of the Fidelity Ethereum Fund will constitute the assets of the Trust.
The importance of spot ETFs
Spot ETFs play a pivotal role in significantly expanding the reach of cryptocurrencies to the average investor, aligning with the goal increasingly being pushed by asset managers such as BlackRock, Grayscale and other players in the sector.
Despite concerted efforts by regulators like the SEC to counter this trend, the drive to democratize access to crypto investments has remained unwavering.
ETH market cap currently at $232 billion on the weekly chart: TradingView.com
At the forefront of the crypto market, Bitcoin and Ethereum are two of the most important digital assets, generating significant trading volumes and market values.
Drawing a parallel with Bitcoin, Ethereum is poised to experience a potentially significant increase in value in the next 24 hours, driven by the announcement of Fidelity’s application, marking a development that could have a significant impact on the crypto landscape -currencies.
ETH up 6.2% in weekly chart
At the time of writing this article, ETH was trading at $1,930up 2.3% in the last 24 hours, and now a decent 6.2% increase in the last seven days, according to Coingecko data.
Citing part of the court’s decision in the legal battle between Grayscale and the SEC, Fidelity Investments is optimistic that he will receive authorization.
Update: @Loyalty joins the spot #Ethereum Course ETF by filing a 19b-4 with @CBOE https://t.co/rxNEzpzh3g pic.twitter.com/o96XspPDEP
–James Seyffart (@JSeyff) November 17, 2023
The court argued that the SEC did not have reasonable justification for denying Grayscale’s request to convert its famous Bitcoin Trust into a full-fledged Bitcoin Exchange Traded Fund (ETF), especially in light of the pre-approval futures contracts linked to BTC.
As a result, the court ordered a review of the SEC’s decision, and current information suggests that the SEC and Grayscale are still in talks about the suggested product.
Emerging Importance of Crypto Assets
Fidelity has vocally expressed its admiration for Ethereum. In a recent discussion, Chris Kuiper, the company’s director of research, examined the emerging importance of digital assets and projected their potential for expansion in the foreseeable future.
The company’s hope that ETH will be used for large-scale transactions in the future is also expressed in Fidelity’s Spot Ethereum ETF app.
(The content of this site should not be construed as investment advice. Investing involves risk. When you invest, your capital is subject to risk).
Featured image from Consensys
