$5 Million Ethereum Index Fund Debuted By Fidelity

Summary:

• Fidelity announced a new Ethereum index fund per details from a filing with the Securities and Exchange Commission.
• The mammoth asset manager boasts around $5 million in investments for its latest crypto offering.
• Galaxy Digital CEO Mike Novogratz hinted that the company might provide retail exposure to Bitcoin soon.

A filing with the U.S. Securities and Exchange Commission (SEC) revealed that Fidelity has expanded its suite of crypto-related offerings with a new Ethereum Index Fund. The investment giant recorded its first sale for the fund on September 26, 2022. 

However, the SEC filing was submitted on Tuesday. At the time of the filing, the new Ethereum index fund had recorded a total of $5 million in investments. 

Index funds are different from exchange-traded funds (ETFs), another class of financial products also offered by the $4.5 trillion-strong asset manager. While ETFs are tradable all day long in a manner similar to company shares or stock, index funds only trade after other markets have closed.

Also, index funds have fixed rates meaning that investors must deploy a predetermined amount when trading such funds. Fidelity’s new Ethereum index fund boasts a minimum of $50,000 and is limited to accredited investors. These investors are usually institutions with considerable liquidity.

Fidelity’s index fund could compete directly with other Ethereum index funds offered by companies like Grayscale and Bitwise.

Fidelity And Other Institutions Bet On Crypto Despite Market Slump

Fidelity’s SEC filing for its new Ethereum index fund comes shortly after Galaxy Digital CEO Mike Novogratz hinted at possible Bitcoin exposure for the company’s 34 million retail users around the world.

Novogratz teased that a little birdie said the $4.5 trillion asset manager could shift its retail customer base into crypto soon enough. However, the minimum investment for the latest Ethereum index fund could prove too high for the average retail investor.

Regardless, institutional appetite for crypto has shown activity despite a slump in digital asset prices. BlackRock, one of the largest asset managers in the world with $10 trillion under its belt unveiled Bitcoin trading for Aladin customers. 

The Bitcoin exposure will be powered by a partnership with Coinbase Prime, per reports. Nasdaq’s new digital asset department lead Ira Auerbach also opined that institutional demand will drive the next wave of crypto adoption.