An article to understand Fidelity's entry route in the field of cryptocurrency

Almost all blockchain media have previously reported that Fidelity plans to submit an application to the US Securities and Exchange Commission (SEC) to establish a bitcoin investment fund. This comes as no surprise to many in the industry, as the Fidelity Digital Assets group has been planning this for quite some time. In fact, Fidelity has been in the blockchain/cryptocurrency space for a few years now, boasting that it was one of the first large financial institutions to get involved in the space before the 2017 ICO boom.

During the collapse of Terra, Wintermute carried out over $250 million in arbitrage transactions, earning tens of millions of dollars: According to news on December 27, the cryptocurrency market maker Wintermute carried out more than $250 million in UST-LUNA arbitrage transactions during the collapse of Terra, and Limit each trade to $5 million to prevent big losses and make tens of millions of dollars in profits in total. (Forbes)

According to previous reports, the cryptocurrency market maker Wintermute will have a revenue of US$225 million in the first nine months of 2022; and a revenue of US$1 billion for the full year of 2021, with a net profit of US$582 million. Wintermute has $400 million in equity and $720 million in assets, according to Wintermute CEO Evgeny Gaevoy. Of the $400 million in equity, $350 million is in stablecoins (mainly USDC) and cash, and most of the remaining $50 million is venture capital.

In 2021, Wintermute will reach $1.5 trillion in transactions. Some employees receive multimillion-dollar annual bonuses. Wintermute pays shareholders $35 million in dividends, and Gaevoy received a $12 million dividend last year for his 33 percent stake. [2022/12/27 22:09:35]

While other large financial institutions were just getting into cryptocurrencies and even continued to shy away from the nascent field, Fidelity took a proactive approach from the start, launching in 2013 through the Fidelity Center for Applied Technology. Applied Technology launched a blockchain incubator. PANews assumes that less than 10% of those working in the blockchain/cryptocurrency industry know what Bitcoin is, let alone blockchain.

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The two companies announced their partnership in September to foster engagement between the gaming and cryptocurrency communities, and said certain GameStop stores will sell FTX gift cards. Shares of GameStop rose about 5% on Friday. (coindesk) [2022/11/12 12:53:28]

Many believe that after the bitcoin bubble burst in 2013, Fidelity stepped up its research and began allowing clients to invest their own individual retirement account (IRA) money in SecondMarket's bitcoin investment trust. This eventually led to more ancillary services, such as allowing donors to donate to charities using bitcoin, integrating Coinbase into its platform to allow users to track cryptocurrency holdings, and even accepting bitcoin in the company cafeteria.

LooksRare: OpenSea made a profit of $1.5 million through high fees in the Moonbirds transaction: Jinse Finance reported that on April 17, the NFT market LooksRare accused OpenSea of exorbitant fees in the "Pixel Owl" NFT project Moonbirds transaction on its social media account. All of the 7,875 NFTs publicly minted by Moonbirds have been sold out, and created a transaction volume of more than 110 million US dollars in the past 24 hours. LooksRare pointed out that the transaction volume of Moonbirds has reached 20,000 ETH, which means that OpenSea has obtained a fee income of up to 1.5 million US dollars. You can also earn LOOKS Token worth $700,000. [2022/4/17 14:29:53]

As of September 2020, Fidelity has set foot in fields such as bitcoin mining, digital asset custody, and institutional transaction execution, and entered the European market, even obtaining a BitLicense.

Fidelity CEO Abigail Johnson is the main factor driving the company's foray into the cryptocurrency space. She has played the role of Bitcoin evangelist from the beginning. At the Consensus conference in 2017, she revealed that Fidelity has partnered with blockchain startup Axoni, investment firm Boost VC, and MIT, UCL, and Cornell Universities, among others.

As one of the world's largest asset management companies, Fidelity's revenue in 2019 was as high as US$20.9 billion, and its assets under management reached trillions, which is comparable to companies such as Vanguard, Charles Schwab and BlackRock. For the past ten years, their business has been smooth sailing. Its privately held status may also be a factor in their investment in the risky asset, bitcoin. But they also point out that there will be a generational transfer of wealth over the next decade, with investors getting younger and savvier. Fidelity took this as a wake-up call to embrace rather than shy away from the new asset class Bitcoin. Unlike BlackRock's global chief investment strategist Richard Turnill, who lashed out at Bitcoin, Fidelity is welcoming the asset class with open arms.

One advantage big asset managers such as BlackRock, Vanguard and State Street have over Fidelity is their popular ETFs. Although Fidelity also has a number of star ETFs and mutual funds, and they have also become core portfolio investments in IRAs, brokerage accounts, and retirement accounts, if Fidelity can be the first to launch a retail-focused publicly traded bitcoin ETF, it is expected that its Asset size can be doubled several times. They already have the infrastructure, expertise, partners, and target market in place, and the only obstacle now is the SEC.

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