10-Q: Fidelity Wise Origin Bitcoin Fund Reports $10.6 Billion in Net Assets for Q2 2024

Fidelity Wise Origin Bitcoin Fund's Q2 2024 report reveals a significant increase in net assets to $10.6 billion, driven by share issuances and bitcoin price fluctuations.

Summary

• Fidelity Wise Origin Bitcoin Fund reported net assets of $10.6 billion as of June 30, 2024.
• The fund's investment objective is to track the performance of bitcoin as measured by the Fidelity Bitcoin Reference Rate.
• The fund held 167,462.80769789 bitcoin as of June 30, 2024, valued at $10,612,001,000.
• During the quarter ended June 30, 2024, the fund experienced a net decrease in net assets resulting from operations of $1.2 billion.
• This decrease was primarily due to a net unrealized depreciation of investment in bitcoin of $1.1 billion and a net realized loss of $118.1 million from the sale of bitcoin for share redemptions.
• For the six months ended June 30, 2024, the fund's net increase in net assets resulting from operations was $1.4 billion.
• This increase was primarily due to an unrealized gain on investment in bitcoin of $1.5 billion, offset by a net realized loss of $118.2 million from bitcoin sales for share redemptions.
• The Sponsor Fee was waived through July 31, 2024, and will accrue at an annual rate of 0.25% of the Trust's Bitcoin Holdings after that date.
• The fund's NAV per share was $55.42 as of June 30, 2024.
• The fund had 191,500,000 shares outstanding as of June 30, 2024.

Sentiment

Score: 7

Explanation: The sentiment is neutral to positive. The fund has seen significant growth in assets, but also experienced a decrease in net assets during the quarter due to bitcoin price volatility. The waiver of the sponsor fee is a positive for investors.

Positives

• The fund experienced a significant increase in net assets, reaching $10.6 billion as of June 30, 2024.
• The fund's holdings of bitcoin increased to 167,462.80769789 as of June 30, 2024.
• The fund experienced a net increase in net assets resulting from operations of $1.4 billion for the six months ended June 30, 2024.
• The Sponsor Fee was waived through July 31, 2024, reducing expenses for investors during that period.

Negatives

• The fund experienced a net decrease in net assets resulting from operations of $1.2 billion for the quarter ended June 30, 2024.
• The fund experienced a net realized loss of $118.2 million from the sale of the investment in bitcoin for the redemption of Shares for the six months ended June 30, 2024.
• The fund experienced a net unrealized depreciation of investment in bitcoin of $1.1 billion for the quarter ended June 30, 2024.

Risks

• The fund's investment strategy is concentrated in a single asset, bitcoin, which maximizes exposure to market risks associated with bitcoin and digital assets.
• The value of an interest in the Trust can be expected to reduce as a result of a decrease in the value of bitcoin.
• Movements in the Index Price, the principal market price, and the Trust's NAV per Share may be influenced by various factors, including, but not limited to, government regulation, security breaches experienced by service providers, as well as political and economic uncertainties around the world.

Future Outlook

The Trust will continue to seek to track the performance of bitcoin, as measured by the Fidelity Bitcoin Reference Rate, adjusted for the Trust's expenses and other liabilities.

Industry Context

The report reflects the growing interest and investment in bitcoin and digital assets through exchange-traded products, providing investors with a convenient way to gain exposure to bitcoin.

Comparison to Industry Standards

• The report does not provide enough information to compare the results to global benchmarks.
• To compare the results to global benchmarks, more information is needed about the performance of other Bitcoin ETFs, such as BlackRock's iShares Bitcoin Trust (IBIT) and Grayscale Bitcoin Trust (GBTC).
• To compare the results to global benchmarks, more information is needed about the performance of other Bitcoin projects, such as MicroStrategy's Bitcoin holdings.

Related Party Transactions

• Fidelity Service Company, Inc. serves as the Trust's administrator.
• Fidelity Digital Asset Services, LLC serves as the Trust's bitcoin custodian.
• Fidelity Distributors Company LLC is responsible for reviewing and approving the marketing materials prepared by the Sponsor.
• Fidelity Product Services LLC is responsible for the methodology and oversight of the Index.
• FD Funds Management LLC (the Sponsor) is a wholly-owned subsidiary of FMR LLC.

Stakeholder Impact

• Shareholders are exposed to the risks and rewards of bitcoin price movements.
• The Sponsor and its affiliates receive fees for providing services to the Trust.
• Authorized Participants can profit from the creation and redemption of Baskets.

Key Dates

Keywords

Bitcoin, Fidelity, ETF, FBTC, Net Assets, Sponsor Fee, NAV, Bitcoin Holdings, Digital Assets, Cryptocurrency