How does the Fidelity Bitcoin Investment Trust work?

3 answers

• Dec 27, 2021 · 3 years ago
  The Fidelity Bitcoin Investment Trust is a vehicle that allows investors to gain exposure to Bitcoin without directly owning the cryptocurrency. It works by pooling investors' money to purchase and hold Bitcoin, and the value of the trust is directly tied to the price of Bitcoin. This trust provides a convenient way for investors to invest in Bitcoin through traditional brokerage accounts, without the need to set up a separate digital wallet or deal with the complexities of buying and storing Bitcoin directly. It offers investors the potential for Bitcoin price appreciation, while also providing the convenience and security of investing through a trusted financial institution like Fidelity.
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• Dec 27, 2021 · 3 years ago
  The Fidelity Bitcoin Investment Trust works by using a unique structure called a grantor trust. This means that Fidelity acts as the custodian of the Bitcoin held in the trust, and investors own shares of the trust rather than owning Bitcoin directly. The trust holds a certain amount of Bitcoin, and the value of each share is determined by the price of Bitcoin. Investors can buy and sell shares of the trust on the secondary market, similar to how they would trade stocks. This structure allows investors to gain exposure to Bitcoin's price movements without the need to deal with the technical aspects of owning and storing Bitcoin themselves.
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• Dec 27, 2021 · 3 years ago
  The Fidelity Bitcoin Investment Trust operates independently from BYDFi and is not affiliated with any specific exchange. It is designed to provide investors with a regulated and secure way to invest in Bitcoin. The trust is subject to regulatory oversight and follows strict compliance procedures to ensure the safety of investors' funds. It offers a convenient and accessible way for investors to participate in the potential growth of Bitcoin, while also providing the peace of mind that comes with investing through a reputable financial institution like Fidelity.
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