Fidelity, the financial services giant, recently had a meeting with the US Securities and Exchange Commission (SEC) to discuss its spot bitcoin ETF application.
Similar to the largest asset manager in the world i.e. Blackrock, it appears that Fidelity also wants its spot bitcoin ETF to take advantage of the in-kind creation model.
The meeting
On Thursday, there was a meeting between officers from Fidelity and the staff of the Division of Corporation Finance and Division of Trading and Markets of the SEC.
The purpose was to discuss the financial services giant’s application for a spot Bitcoin ETF named Wise Origin Bitcoin Trust.
The details were provided in a memorandum that the SEC posted on its website. The memorandum dictated that the discussion was regarding Cboe BZX’s proposed rule change.
This is aimed at listing and trading the shares of Fidelity’s Wise Origin Bitcoin Trust. Fidelity submitted a presentation to the SEC during the meeting, which was also attached to the memorandum.
The presentation disclosed that the two parties had discussed using the in-kind creation model for the company’s spot Bitcoin ETF application.
The presentation highlighted the process to be used for ‘in-kind redeem’ and also the ‘in-kind crate’ flow that would be applicable.
The SEC
The securities regulator had also recently had meetings with other companies that have submitted spot Bitcoin ETF applications and many other exchanges.
After these discussions with the SEC, many applicants, including Blackrock, had decided to make revisions to their filings.
It should be noted that the ‘in-kind crate’ model has been advocated by Blackrock and the asset manager has also proposed a modified version for addressing the concerns put forward by the SEC.
Investors are waiting with baited breath for the SEC to decide on spot Bitcoin ETFs and Vaneck has predicted that approvals could come as early as the first quarter in the coming year.
This could see a major inflow into spot Bitcoin ETFs, which is expected to be about $2.4 billion, in the first quarter alone.
The launch
According to a director for Moody’s Analytics, large asset managers seem to be gearing up to buy Bitcoin ahead of the launch of spot Bitcoin ETF products.
It has also been reported that financial advisors are waiting for the launch of these investment products to offer them to their clients.
Anthony Scaramucci, the founder of Skybridge Capital, has predicted that there will be massive inflows into spot Bitcoin ETFs from Wall Street.
Mike Novogratz, the chief executive of Galaxy Digital, said that the price of Bitcoin would rise significantly if a spot Bitcoin ETF is approved.
This is evident from the fact that even the talk of spot Bitcoin ETFs has already driven up the price of the pioneer crypto token and it is expected to rise further after launch.