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Fidelity reportedly next to file for Bitcoin ETF while ARK may be ahead of BlackRock
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[Kitco News](/)) – BlackRock helped spark a revival in the cryptocurrency market when it filed for a spot Bitcoin (BTC) exchange-traded fund (ETF) on June 15.Now another major investment manager is looking to follow suit with reports that Fidelity is preparing to file an application with the U.S.Securities and Exchange Commission (SEC).According to The Block, a source familiar with Fidelity’s plans says the application has been completed and could be submitted as early as Tuesday as firms race to get in line behind BlackRock.
Invesco, WisdomTree and Bitwise have all re-filed for spot BTC ETFs in the wake of BlackRock’s filing, and Fidelity is the latest to join that list, as this will be the firm’s second attempt at gaining approval.The company filed for its Wise Origin Bitcoin Trust in 2021, but that application was denied by the SEC in early 2022.
Fidelity has declined to comment on this development at this time.With tens of millions of retail brokerage clients and more than $11 trillion in assets under management, a Bitcoin ETF approval for Fidelity would mark a major milestone for BTC and the broader cryptocurrency ecosystem.
While BlackRock’s filing has been credited with the turnaround in the crypto market, reports now suggest that Cathie Wood’s ARK Investment Management is actually first in line for approval of such a product.
According to a
report from Financial Review, ARK and the European asset manager 21Shares are now the only applicant ahead of BlackRock for a spot BTC ETF after the pair filed an application with the U.S.
Securities and Exchange Commission (SEC) in April.
Yassine Elmandjra, an analyst with ARK, noted that while the BlackRock filing has set its application apart with the addition of “unique” exchange surveillance-sharing agreements intended to help prevent market manipulation, “other applicants will be able to amend their filings with similar agreements at little cost.”
Because of the ability to amend the application filed in April, ARK’s Bitcoin ETF application is “now the only one ahead of BlackRock’s,” and could become the first one to be granted approval, Elmandjra said.
James Seyffart, Bloomberg Intelligence’s ETF analyst, also claimed that ARK and 21Shares were next in line for approval.“21Shares, ARK and CBOE [Chicago Board Options Exchange] are first in line because their next SEC decision date is Aug.13, 2023, and we don’t yet have a date for the other 19b-4 applications like the one from BlackRock,” Seyffart said.
While ARK may be ahead of BlackRock in line for approval, the world’s largest asset manager is still the driving force behind the renewed interest in the asset class, as highlighted by Bloomberg senior ETF analyst Eric Balchunas when he
wrote, “And our bull case for spot bitcoin ETF approval can basically be summed up in four words: ‘What does BlackRock know?’”
There is a lot of speculation as to why BlackRock chose to file its application now – ranging from trying to capture the upside before the next Bitcoin halving in April 2024 to allegations that the firm has inside information about the SEC’s BTC ETF policies – but the fact remains that the filing has helped bring renewed optimism to the asset class.
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That said, some have urged U.S.crypto holders not to get their hopes up for an approval in the near future as the SEC has been stingy and slow moving when it comes to previous Bitcoin ETF applications.
According to Balchunas, “While we think spot bitcoin ETF has 50% chance of getting approved this year we also think there’s 50% chance of denial.” He
noted that if BlackRock uses Coinbase as its exchange, that could be an issue because the exchange is “not that big, nor is it regulated.”
“Another reason we give spot bitcoin ETF approval 50% chance is our senior legal analyst [Elliot Stein] gives Grayscale a 70% chance of winning [its] case against [the] SEC, who could approve BlackRock’s ETF as a way to save face using trusted ‘adult’ TradFi [companies] & stick it to Grayscale,” he said.
In reference to the ongoing Grayscale case with the SEC, Paradigm policy director Justin Slaughter
said, “The D.C.
Circuit typically issues decisions about 3-5 months after oral arguments, so an opinion could drop in that case any day now.And some cases that had oral arguments in March and April have received opinions in the last few weeks.”
In response to this statement, Andrew Kang from Mechanism Capital
https://twitter.com/Rewkang/status/1670689835349340161, “[A] decision in Grayscale vs SEC case expected in next few weeks.[The] result could tip the tables to Bitcoin ETF approval much sooner than [the] 240-day requirement.Negative headline risk now balanced with positive headline risk.”.
