- Fidelity updates its Bitcoin Spot ETF application, addressing SEC’s concerns on custody, valuation, and more.
- Fidelity joins Ark Invest and Invesco in refining applications, indicating ongoing engagement with the SEC.
Key Amendments in Fidelity’s Updated Filing
Fidelity Funds Management LLC has made an imperative move in the crypto ecosystem by submitting a revised version of its Spot Bitcoin Exchange-Traded Fund (ETF) prospectus to the U.S. Securities and Exchange Commission (SEC). This refined submission underlines Fidelity’s proactive approach, considering the changes observed in ETF applications from other significant players like Ark Invest and Invesco.
🔐 Fidelity, the $4,300,000,000,000 asset manager, has just submitted a revamped #Bitcoin spot ETF prospectus to the #SEC. 💼 This updated version dives into custody, valuation, GAAP compliance, risk disclosures, and even addresses #mining energy consumption.🌐📊#BitcoinETF #BTC pic.twitter.com/jw9GBqE8iZ
— Collin Brown (@CollinBrownXRP) October 18, 2023
The recent amendments in the ETF prospectus emphasize:
- Detailed custodial arrangements: A crucial facet of any ETF, this determines how the underlying assets, in this case, Bitcoin, are securely held and managed.
- Mechanics around hard forks: Hard forks in the blockchain world refer to changes that split the existing chain into two paths. Addressing this provides clarity on how the ETF would handle such situations.
- Valuation, pricing sources, and GAAP compliance: Establishing a clear framework for valuation and ensuring alignment with Generally Accepted Accounting Principles (GAAP) is paramount for regulatory approval.
- Risk disclosure amid regulatory ambiguity: This highlights potential challenges and uncertainties, providing investors with a comprehensive view of the risks involved.
- Mining’s energy consumption: The energy-intensive nature of Bitcoin mining has raised environmental concerns. The SEC, in its evaluation, seeks to understand the geographical implications of mining and how ETF issuers might counteract potential negative impacts, especially concerning Bitcoin’s price.
James Seyffart, an ETF specialist with Bloomberg Intelligence, interprets these updates as a positive sign, signaling authentic dialogue between the SEC and ETF applicants. The shared themes across submissions from Fidelity, Ark Invest, and Invesco suggest the SEC’s focus areas for potential approval metrics.
The crypto market is anxiously awaiting a response, with anticipation building for possible approvals in Q1 of 2024. This anticipation reached a crescendo when rumors circulated about the SEC approving BlackRock’s iShares Spot BTC ETF, which led to significant market fluctuations. These episodes emphasize the market’s eagerness for a Spot BTC ETF and heighten the pressure on SEC chair, Gary Gensler, to provide a definitive verdict.
My base expectation is a batch will go effective Q1, but there’s still some uncertainty.
— Scott Johnsson (@SGJohnsson) October 17, 2023
As the narrative unfolds, Bitcoin‘s current price remains at approximately $28,300, reflecting recent market volatilities.