What Is FBTC? Fidelity Bitcoin ETF Explained and How to Buy

Fidelity has stepped into the cryptocurrency spotlight with FBTC, its spot Bitcoin Exchange-Traded Fund (ETF).

Unlike buying Bitcoin directly, FBTC lets you invest in Bitcoin through your regular brokerage account, making it simple for traditional investors to participate in the crypto market.

Launched in January 2024, FBTC has already grown into the second-largest Bitcoin ETF, holding more than 206,000 Bitcoin valued at over $24 billion.

So, what makes FBTC different, and why are investors paying attention?

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Key Takeaways

1. FBTC is Fidelity’s spot Bitcoin ETF that holds real Bitcoin and tracks its price.

2. It offers in-house custody through Fidelity Digital Assets, unlike competitors using third-party custodians.

3. Investors can buy FBTC through standard brokerage accounts without handling crypto wallets.

What Is FBTC?

FBTC stands for the Fidelity Wise Origin Bitcoin Fund, a spot Bitcoin ETF trading under the ticker symbol “FBTC” on the Cboe BZX Exchange.

It was launched on January 11, 2024, after the US Securities and Exchange Commission (SEC) approved spot Bitcoin ETFs.

At its core, FBTC is designed to mirror Bitcoin’s price by holding actual Bitcoin in Fidelity’s custody.

When you purchase FBTC shares, you are essentially buying a portion of a fund backed by real Bitcoin.

This allows investors to gain exposure to Bitcoin’s price movements without needing a crypto wallet or exchange account.

Key Facts About FBTC

• Full Name: Fidelity Wise Origin Bitcoin Fund

• Ticker: FBTC

• Exchange: Cboe BZX

• Launch Date: January 11, 2024

• Assets Under Management: ~$24.4 billion

• Bitcoin Holdings: Over 206,000 BTC

• Expense Ratio: 0.25% annually

How FBTC Works

FBTC uses a creation and redemption process to keep its price in line with Bitcoin’s market value.

Authorized Participants, usually large institutions, buy or redeem FBTC shares in exchange for Bitcoin. This mechanism prevents the ETF price from drifting too far from the underlying asset.

This structure makes FBTC function much like a stock ETF, offering transparency, regulation, and accessibility to mainstream investors.

Read Also: How BlackRock Dominates the Bitcoin ETF Market

Why Investors Choose FBTC

FBTC stands out for several reasons. The most important is Fidelity’s in-house custody service. Unlike other Bitcoin ETFs that use third-party custodians such as Coinbase, FBTC’s Bitcoin is stored by Fidelity Digital Assets. This provides direct accountability and reduces risks associated with outsourcing custody.

Fidelity’s Unique Advantages

• In-House Custody: Managed entirely by Fidelity Digital Assets.

• Proven Experience: Fidelity has researched and worked with Bitcoin since 2014.

• Integration: FBTC fits seamlessly with Fidelity’s broader financial services.

• Liquidity: Average daily trading volume of $300 million ensures easy buying and selling.

• Competitive Fees: A 0.25% annual expense ratio keeps it cost-effective compared to peers.

FBTC vs Other Bitcoin ETFs

• IBIT (BlackRock): Larger, with ~$87 billion in assets but uses Coinbase Custody.

• GBTC (Grayscale): ~$20 billion in assets but charges a much higher 1.5% fee.

• FBTC (Fidelity): ~$24 billion in assets, competitive fees, and unique in-house custody.

FBTC’s positioning makes it appealing to investors who value a combination of trusted management, reasonable costs, and reliable infrastructure.

Read Also: Bitcoin Nears $120K on ETF Inflows and Ethereum Rally

How to Buy FBTC

One of FBTC’s biggest strengths is accessibility. Investors do not need to set up a crypto wallet or sign up for a crypto exchange.

Instead, they can purchase FBTC through their usual brokerage accounts, just like they would buy stocks or traditional ETFs.

Step-by-Step Guide to Buying FBTC

• Open a Brokerage Account: Choose a broker that lists FBTC, such as Fidelity, Vanguard, Schwab, Robinhood, or Interactive Brokers.

• Fund Your Account: Deposit funds using a bank transfer or other available method.

• Search for FBTC: Use the ticker symbol “FBTC” in your broker’s trading platform.

• Place an Order: Choose between a market order for immediate purchase or a limit order for a set price.

• Manage Your Investment: Track FBTC’s performance alongside your portfolio and decide on holding strategies.

Tax and Retirement Account Eligibility

FBTC can also be held in retirement accounts like IRAs and 401(k)s, making it attractive to long-term investors.

Tax treatment is the same as traditional ETFs, where you are taxed only when you sell shares, simplifying reporting compared to direct Bitcoin ownership.

This structure lowers the barrier for mainstream adoption, making FBTC a convenient entry point for those curious about Bitcoin exposure without dealing with technical hurdles.

Read Also: How ETFs Are Quietly Changing Bitcoin’s Market Structure

Conclusion

FBTC has quickly become one of the most important Bitcoin ETFs in the market. By combining Fidelity’s long-standing reputation, in-house custody model, and competitive fees, FBTC offers a practical way for investors to participate in Bitcoin’s growth through a familiar investment structure.

While risks remain due to Bitcoin’s volatility and evolving regulations, FBTC provides a secure and accessible option for exposure.

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FAQ

What is FBTC?

FBTC is Fidelity’s spot Bitcoin ETF, designed to track Bitcoin’s price by holding real Bitcoin.

How do I buy FBTC?

You can buy FBTC through standard brokerage accounts, just like you would with stocks or ETFs.

What makes FBTC different from other Bitcoin ETFs?

Its unique in-house custody by Fidelity Digital Assets, competitive fees, and strong liquidity.

Can FBTC be held in retirement accounts?

Yes, FBTC can be added to IRAs and 401(k)s, making it suitable for long-term investors.

Is investing in FBTC risky?

Yes, like all Bitcoin investments, FBTC is subject to volatility and regulatory changes, so investors should evaluate risk tolerance carefully.

Disclaimer: The views expressed belong exclusively to the author and do not reflect the views of this platform. This platform and its affiliates disclaim any responsibility for the accuracy or suitability of the information provided. It is for informational purposes only and not intended as financial or investment advice.