Fidelity Investments Apply For Metaverse ETF Licensing With the SEC

Investment management giant Fidelity has applied for an exchange-traded fund (ETF) license that will allow the company to surveil public firms and monitor their development and marketing activities in the budding Metaverse.

The investment behemoth submitted the license application to the United States Security and Exchange Commission (SEC) on January 27.

The Fidelity Metaverse ETF

Fidelity Investment’s license application that was submitted to the SEC details permission for the launch of its Fidelity Metaverse ETF. Fidelity’s proprietary ETF will reportedly track a Fidelity Metaverse Index, an index that monitors the on-chain performance of a basket of companies that procure, develop, manufacture, disburse, market, or sell commodities and services that are linked to the development of the Metaverse.

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Fidelity’s license application however was only added to the long list of corporate entities attempting to capitalize on the skyrocketing interest growth of the Metaverse. Other crypto giants in the globe have beat Fidelity to the punch, mainstream media have previously reported the increasing number of metaverse licensing applications that the SEC has received over the last few months. 

A notable ETF license applicant is Proshares, a Bitcoin ETF offering platform, the crypto company previously filed for a metaversal ETF licensing with the SEC in December last year. 

ETFs In The Crypto Industry

Exchange-traded funds (ETFs) essentially refer to a combo of securities and equities that you can buy, sell and read via a brokerage corporation on any equity market. It is a popular substitute for stock indexes as it offers a lower cost of market exposure to investors in general. 

The low-risk option that ETFs offer has facilitated the diffusion of the asset class in the crypto industry globally as several crypto entities begin to adopt the underlying concept for broader trading options.

In the crypto industry, the ETF concept has been adapted to track Bitcoin and other relevant cryptocurrencies at low cost and with broader marginal calls. The index tracker has however been modified to track more than cryptocurrencies in the crypto industry, it was modified to feature relevance on the nascent web3 met averse.

In June last year, Roundhill Investments launched a new and novel ETF which was largely successful. The metaverse ETF now trades on the New York Stock Exchange (NYSE). Another adaptation of ETFs cropped up in the South Asian nation of South Korea as four established asset management firms in the country started to feature metaversal ETFs in their services catalog. 

The SEC And Spot ETF

Although Fidelity checked all the relevant boxes before it filed for its ETF license, the application was unsurprisingly shot down and rejected by the SEC on January 27, adding to the growing list of recently rejected ETF license applications.

The SEC is widely known for its hardcore stance on non-BTC leveraged ETFs, so the latest case of Fidelity’s spot ETF rejection didn’t surprise the community.  The financial watchdog’s rejection of Fidelity’s application is consistent with prior decisions and highlights the regulator’s preference for ETFs that primarily leverage the Bitcoin features market.

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