Fidelity Offering Bitcoin ETN to Clients

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Fidelity Offering Bitcoin ETN to Clients

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The Bitcoin Tracker One Exchange Traded Note (ETN) has become the first fully regulated financial instrument tied to actual bitcoins that are available for purchase by traders and investors in the United States. It is listed under the ticker symbol CXBTF on NASDAQ Sweden, but is available via OTC Markets to United States investors. Now Fidelity, one of the biggest stock trading firms with USD 2.4 billion of assets, is offering easy CXBTF access to their customers.

This is major news, since Bitcoin has a market cap of USD 110 billion and the overall cryptocurrency market cap is USD 215 billion. Now Bitcoin has direct exposure to investors who own and trade orders of much higher magnitude i.e. 1000% more, than the current amount of money invested in the Bitcoin market. Buying Bitcoin via CXBTF is just as easy, safe, and regulated as buying any other stock on the Fidelity platform. Eventually, due to customer demand CXBTF will likely be available on every major stock trading platform in the United States.

This is the news the entire crypto market had been waiting for since this is a way institutional investors can buy Bitcoin via the stock trading platforms they are used to. The crypto space had been hoping for a Bitcoin Exchange Traded Fund (ETF), and when the Winklevoss Bitcoin Trust ETF and the VanEck SolidX Bitcoin ETF were rejected and stalled respectively it caused the global price of Bitcoin to decline. This Bitcoin ETN is essentially just as good as an ETF, since it provides a way for institutional investors to diversify into Bitcoin on the same channels they use to trade stocks.

Bitcoin is an excellent way to diversify a portfolio, since it is an extremely unique asset class that has been showing strong long-term growth, and it is inevitable that institutional investors will invest a small fraction of their portfolio into Bitcoin in the future.

Currently, XBT Provider, a CoinShares company, is holding USD 334 million of Bitcoin for Bitcoin Tracker One and Bitcoin Tracker Euro, and USD 109 million of Ethereum for Ether Tracker One and Ether Tracker Euro. This is not an insignificant amount relative to the total Bitcoin and crypto market caps, and now that it’s available in the United States these numbers should surge.

One very important thing to note is that XBT Provider backs the Bitcoin Tracker One ETN with actual bitcoins, so as investors buy CXBTF, XBT Provider buys actual bitcoins. Therefore, CXBTF has a direct impact on spot markets and therefore the global Bitcoin price. This is much better than the Bitcoin futures in Chicago on CME and CBOE, which are backed by cash and don’t directly influence global Bitcoin price.

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