On Thursday, Fidelity Canada officially Launched The Fidelity Advantage Bitcoin Exchange-Traded Fund (ETF) and Fidelity Advantage Bitcoin ETF (Mutual Fund), representing the first assets to be offered in the country and Confirm previous reports on this issue. The funds contain the FBTC and FBTC.U indices, denominated in Canadian and US dollars, and are listed on the Toronto Stock Exchange. Fidelity’s Bitcoin ETFs seek to track Bitcoin’s performance (BTC) Spot price. Fidelity currently manages C$208 billion ($162.27 billion) In assets in the country.
ETFs will have an annual management fee of 0.4%. Operating expenses and trading costs are not yet available because the assets are still new. More than 98% of bitcoins bought by funds are stored in cold wallets.
The implications are significant for Canadian retail investors who open accounts registered with the government, such as a Tax-Free Savings Account (TFSA), and buy Bitcoin ETFs. As the name implies, securities held in a TFSA are exempt from capital gains tax obligations.
Since 2009, the TFSA’s annual contribution limit has ranged from C$5,000 ($3,903) to C$10,000 ($7,807). Unused contributions from prior years are carried forward, making them cumulative. In addition, all realized profits accumulated in the TFSA account are credited to the contribution room. Hypothetically, if an investor buys $10,000 in a Bitcoin ETF and sells it for $20,000, the additional capital increase from reinvesting the entire $20,000, not $10,000, will qualify for the capital gains tax credit.