Why the Fidelity Wise Origin® Bitcoin Fund (FBTC) Is My Spot Bitcoin ETF of Choice

I’m a firm believer in bitcoin. Even with its wild volatility, the possibility of deep and prolonged drawdowns, and the constant noise from grifters and opportunists, the asset itself is brilliant.

Bitcoin is the anti-debasement tool of the 21st century, filling the same role gold has played for centuries. Its fixed supply, predictable issuance, and transparent rules give it a monetary profile that no government or central bank can alter.

After years of resisting it, major institutions have accepted this reality. They’ve added bitcoin to balance sheets, structured products around it, and built compliant ways to hold it for clients.

Spot bitcoin ETFs are the clearest example of that shift. I still believe self-custody is the gold standard for long-term holders, but ETFs have real utility for newcomers and for investors using tax-advantaged accounts like a Roth IRA.

Whenever someone asks which spot bitcoin ETF I prefer, I always land on the Fidelity Wise Origin Bitcoin Fund (FBTC). In my view, it is the standout choice. Here’s why.

Custody Risk Actually Matters

Did you know that at launch, eight of the eleven spot bitcoin ETFs relied on one custodian: Coinbase? That level of concentration introduces a real single-point-of-failure risk.

Coinbase tries to reassure investors by highlighting several safeguards: offline cold-storage of the vast majority of digital assets, insurance policies covering certain losses, strict access controls, internal audits, and ongoing security testing. Those protections are useful, but no centralized custodian is flawless.

There have been past security incidents in the crypto ecosystem, some involving Coinbase, some involving other exchanges. Even when incidents were unrelated to custodial cold-storage systems, they serve as reminders that centralized platforms are not immune to breaches. “Unrelated” does not mean “unbreakable.”

This is where the philosophical tension becomes impossible to ignore. Buying a securitized wrapper of a decentralized asset and parking the underlying reserves at a centralized exchange runs directly against the ethos that made bitcoin valuable in the first place.

Bitcoin was created to eliminate reliance on trusted third parties. Dropping the keys into the hands of a single custodian recreates the same structural fragility bitcoin was meant to solve. That contradiction has always bothered me, and if you’re a believer in Bitcoin’s long term potential, it should bother you too.

Why FBTC Is Different

Fidelity Digital Assets chose to custody FBTC’s reserves internally because the firm spent a decade preparing for this moment.

Long before spot bitcoin ETFs were even possible, Fidelity decided that if digital assets were going to become part of the financial system, it needed to build the core infrastructure itself rather than rely on an outside exchange. That commitment began in 2014.

In 2015, Fidelity Charitable began accepting bitcoin donations from donors. In 2018, Fidelity became the first traditional financial institution to onboard and custody an institutional manager’s bitcoin through Fidelity Digital Assets. In 2020, it added an asset management arm and collateral agent services. In 2023, the firm launched Fidelity Crypto for Wealth Managers. These developments were not last minute fixes but a continuous and deliberate build over ten years.

FBTC launched in 2024 and represents the culmination of that decade of development. This matters because firms of similar size, such as BlackRock iShares, and even crypto specialists like Grayscale and Bitwise, chose to use Coinbase for custody. Fidelity did not. That difference gives investors a real advantage when thinking about counterparty concentration and operational resilience.

When someone asks me about bitcoin, I still send them information on how to securely self-custody. If that feels too technical, (and many people rightfully feel that way), FBTC is my next suggestion, because it does not rely on a single external crypto exchange to safeguard the underlying asset.

The fee is reasonable at 0.25%. It is not the cheapest, but it is far from the most expensive. FBTC has about $22.5 billion in assets and trades efficiently with a 0.05% 30 day median bid ask spread.