Canadian Fintech Dominated by Crypto Investments; BlackRock and Fidelity Bitcoin ETFs Shine; Ripple to Share Records with SEC
Summary:
Crypto and blockchain investments lead in the Canadian FinTech sector, despite a downturn in overall deal volumes in 2023. This dominance is driven by expectations of Bitcoin ETF approvals by the U.S. SEC. BlackRock and Fidelity's Bitcoin ETFs are among the top inflow performers of 2024. Meanwhile, Ripple has been commanded by a U.S. judge to disclose specific financial documents to the SEC as part of their ongoing regulatory trials.
Canada's fintech sector saw the greatest investment in the domains of crypto and blockchain for two consecutive years. BlackRock's Bitcoin fund is fast approaching the top spot for 2024's ETF inflows. Concurrently, Ripple has been mandated by a U.S. judge to provide its financial records to the country's securities regulator. Canada's fintech business witnessed an unparalleled scale of deals and investment in 2023, despite a substantial slide in the overall deal volumes and values. According to data from KPMG, this investment predominance was held by the crypto and blockchain industry, reflecting 31 such deals in 2023 - the highest among all fintech sub-sectors. Trailing behind were software-as-a-service and artificial intelligence/machine learning sectors, with 24 and 15 deals respectively. KPMG's Edith Hitt attributes this keen investor interest towards crypto-based fintech endeavours to the expected ratification of Bitcoin's spot ETFs by the U.S. Securities and Exchange Commission.
The Bitcoin ETF by BlackRock, called the Shares Bitcoin Trust (IBIT), has already amassed inflows worth $3.9 billion post its launch on January 11. According to an analysis by Bloomberg ETF's Eric Balchunas on February 5, this places the fund amongst the top 0.16% of all ETFs issued across the United States. The fund's performance is only outshined by broad index funds that follow the S&P 500 and Vanguard’s Total Stock Market ETF. Fidelity's Bitcoin ETF, named as the Fidelity Wise Origin Bitcoin Fund (FBTC), seats in the eighth place amongst the U.S. ETFs, recording inflows worth $2.51 billion post January 11. The final rankings saw both the funds move upwards from positions eight and ten since the end of January, despite a seven-day trading handicap compared to all other products. On another note, Ripple has been asked by a U.S. District Court Judge to present certain financial documents to the SEC as part of its ongoing proceedings against the firm. This directive from Judge Sarah Netburn on February 5 pertains to Ripple's financial statements and institutional sales contracts from 2022 and 2023. Ripple and its executives were previously sued by the SEC in December 2020 for allegations related to illegal securities sales. In July 2023, Ripple won a summary judgment, following which the SEC chose to withdraw its case against the executives but continue the litigation against Ripple. Readers are reminded that this narrative is not financial advice, rather mere observations. Any investment or trading decisions should ideally follow thorough independent research and assessment of risks involved.
Published At
2/7/2024 4:28:28 PM
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