As fellow Publish0x author The Kragle reported in his article Heavyweight Bitcoin Battle - Fidelity vs. Greyscale Bitcoin:
Yesterday, it was reported that Fidelity will launch its first fund dedicated to Bitcoin, called the Wise Origin Bitcoin Index
Not much is known at this time, but the following details were included in the media report:
- It will be a passively managed Bitcoin-only fund
- Investors will be limited to qualified purchasers through family offices, registered investment advisers and other institutions
- The minimum investment is $100,000
Did you catch that?
It will be a passively managed Bitcoin-only fund
What can we learn from this?
My first thought: Bitcoin-only and passively managed.
-- That's easy to replicate, isn't it?
So why is this fund being created? Whom are they targeting?
-- I guess they target investors who don't want to deal with crypto exchanges, wallets and so on. Investors who want to put quite a nice sum into Bitcoin specifically and don't want to risk losing their investment by making a technical mistake.
Why are these people investing into Bitcoin?
-- The target audience are investors who either see Bitcoin as a store of value or who want to speculate on higher Bitcoin prices.
Or in other words: People who invest their money probably for the long term.
What might be the effect on Bitcoin prices?
-- This fund will most certainly lead to an influx of new money into Bitcoin.
In the long-term that should lead to higher Bitcoin prices.
What else can we learn?
The people who are investing in this fund probably haven't used Bitcoin for financial transactions such as paying for goods and services. At least not yet. I believe that shows that we are still in the early days for Bitcoin. Many investors could potentially still be convinced to invest into Bitcoin in the future. That should lead to even higher prices in the long run (if these potential investors will be convinced).
It is certainly a positive sign that this fund is being created. I believe that it is another indication that the Bitcoin price still has a lot of upside potential left and that we are nearing the realization of that upside.
What do you think?
What else can we learn that I have failed to mention? Or do you think I am completely off with my analysis/speculation? Let me know in the comments.
This is not financial advice in any form whatsoever. I am not qualified to give advice. I am solely sharing my thoughts on the topic for entertainment purposes only. You should not base any financial decisions on anything you read in this article. Do your own research. You are responsible for your own investments.
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