BlockFi Officially Launches the Bitcoin Trust with Fidelity Digital Assets as Custodian

BlockFi has launched its new Bitcoin Trust, as per the announcement made on Tuesday.

The fintech firm registered the trust with the US Securities and Exchange Commission (SEC) late last month, and now it has joined the likes of Grayscale Bitcoin Trust and CoinShares.

The competition in the space continues to increase as a growing number of investment vehicles offer institutional investors’ exposure to cryptocurrencies. Zac Prince, Founder & CEO of BlockFi, said,

“Given the level of institutional activity in recent months and demand for new, professional-grade investment vehicles, the timing of BlockFi Bitcoin Trust is ideal.”

The firm believes this product “will facilitate greater investments in digital assets,” with Yevgeniy Feldman, Vice President for Institutional Services at BlockFi, expecting this to “play an important role in improving access in this nascent market.”

Founded in 2017, the company today announced the launch of the BlockFi Bitcoin Trust, which will provide easy access to BTC for institutions and accredited individual investors for a management fee of 1.75%.

For the custody of the digital asset, BlockFi has chosen Fidelity Digital Assets Service. Christine Sandler, Head of Sales and Marketing for Fidelity Digital Assets, said,

“The digital asset ecosystem has grown significantly in recent years, creating an even more robust marketplace for investors and accelerating demand among institutions.”

While the Trust shares are available to global institutional and qualified investors in the near-term, US-based accredited investors won’t be eligible until later.

The New Jersey headquartered company, which is also providing liquidity for ETH futures on CME along with Galaxy, Genesis, CoinShares, and NYDIG, announced the clearing of the first-ever block trade for Ethereum futures on Monday.

Besides offering OTC trading, BlockFi also offers institutional lending, and just last month, it paid users more than $28 million in interest, including a BlockFi investor and author, Jason A. Williams, who is the ‘undisputed BTC interest champ.'

BREAKING: @BlockFi has paid me $1,000,000 in interest payments.

Thanks @BlockFi for making me a Crypto Millionaire!
(and they sent me my belt too!) I can't wait to see each of you do the same! pic.twitter.com/yT01kyQWHx

— Jason A. Williams🚀 (@GoingParabolic) February 6, 2021

Bitcoin and Ethereum made up the majority of the share of this interest paid at roughly 400 BTC and 4500 ETH plus 5 million in stablecoins.

The centralized crypto lender has been seeing immense growth, with its AUM growing 1.5x to over $4 billion last year.