Representations of cryptocurrency Bitcoin are placed on a PC motherboard in this illustration taken June 16, 2023.
Dado Ruvic | Reuters
Crypto investors are waiting for the Securities and Exchange Commission to approve a raft of spot bitcoin applications, likely Wednesday
With a spot bitcoin ETF now looking very real, attention is turning to the details of how it will trade, how much it will cost, how much of the runup in bitcoin is due to demand that has been pulled forward, and premium or discount valuations.
Fees are competitive and will get more so
With nearly a dozen ETFs competing for attention, bitcoin buyers will be very price sensitive, and issuers are already engaged in a modest price war. For example, Cathie Wood’s ARK Invest, which is partnering with 21Shares to launch a bitcoin ETF, initially announced a fee of 0.8% but on Monday announced no fee for the first six months.
Other issuers are also steeply discounting prices, with several (Bitwise, ARK, Invesco) offering 0% fee for the first six months, while Grayscale is charging 1.5%.
Spot bitcoin ETF fees
Bitwise (GBTC) 0.0% (after first six months: 0.24%)
ARK Invest/21Shares (ARKB): 0.0% (after first six months: 0.25%)
Invesco Galaxy Bitcoin ETF (BTCO) 0.0% (after first six months: 0.59%)
iShares Bitcoin Trust (IBIT) 0.20% (after first 12 months: 0.30%)
VanEck Bitcoin Trust (HODL) 0.25%
Franklin Templeton Digital Holdings Trust 0.29%
Fidelity Wise Origin Bitcoin Trust (FBTC) 0.39%
WisdomTree Bitcoin Trust (BTCW) 0.50%
Valkyrie Bitcoin Fund (BTF) 0.80%
Grayscale Bitcoin Trust (GBTC) 1.50%
Invesco’s Galaxy Bitcoin ETF has set its expense ratio at 0.0% for the initial six months and the first $5 billion in assets, and goes to 0.59% after.
How will a spot bitcoin trade relative to bitcoin and bitcoin futures?
One of the main questions is how well a spot bitcoin ETF will track bitcoin and bitcoin futures.
Simeon Hyman, ProShares’ global investment strategist who manages the largest bitcoin futures ETF, the…
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