Bitcoin ETF applicants BlackRock, VanEck and WisdomTree have disclosed fees for their proposed ETFs amid a flurry of filings with the U.S. Securities and Exchange Commission (SEC) amending Form S-1.
BlackRock sets the fee at 0.2% for the first year or until ETF assets reach $5 billion, after which it increases to 0.3%. WisdomTree chose a higher 0.5% fee, while VanEck chose a 0.25% fee. Last week, VanEck pledged 5% of the proposed ETF’s profits to Brink’s core Bitcoin developers.
Ark Invest/21Shares, Invesco and Fidelity also filed revised Form S-1s, with Ark Invest lowering its fees to 0.25% from the previously announced 0.8%.
“ETF Terrordome is no joke,” Bloomberg Intelligence analyst Eric Balchunas said on Twitter, noting that BlackRock’s 0.3% fee is “much cheaper than I expected.” He added: “Life has become much harder for everyone else.”
Spot Bitcoin ETFs give investors exposure to the underlying asset, BTC, without all the overhead of having to figure out how to purchase, manage private keys, or use a hardware wallet. In return for not having to perform such administrative tasks, investors pay a fee to the fund issuer. And, all else being equal, the lowest and most competitive fees usually prevail.
After filing amended Forms 19b-4 on Friday, both companies are rushing to file amended Forms S-1 before the SEC’s deadline expires at 8 a.m. today.
Bitcoin ETF Competition
The SEC has historically rejected all applications for spot Bitcoin ETFs, but the entry of BlackRock, the world’s largest asset manager, into the market in 2023 has sparked renewed optimism that ETF approval could be imminent.
This race gained further momentum after Grayscale’s court victory in August 2023, where a judge ruled that the SEC must review an application to convert the Grayscale Bitcoin Trust.GBTC) convert the product to a spot Bitcoin ETF.
The SEC now has a short window to approve multiple spot Bitcoin ETF applications at once before January 10th.
Bloomberg Intelligence’s Balchunas increased the odds of the SEC approving a spot Bitcoin ETF in January to 95% by the end of this week. However, cryptocurrency prediction market Polymarket shows market participants taking a more cautious stance, capping the odds of the Bitcoin ETF being approved by January 15 at 83%. %.
In a Bitwise poll conducted last week, only 39% of financial advisors surveyed were confident that spot Bitcoin ETFs would be available to U.S. investors in 2024.
Edited by Stacey Elliott.
Stay up to date with cryptocurrency news and receive daily updates in your inbox.
