Grayscale’s planned new mini version of the bitcoin exchange-traded fund (ETF) will be the market leader in terms of fees, according to a recent filing.
The new mini Bitcoin exchange-traded fund (ETF) from the world’s largest asset manager is aimed at maintaining its position as the market leader in spot Bitcoin ETFs after its flagship GBTC product saw massive capital outflows.
To achieve this, Grayscale Investments has filed to launch a smaller bitcoin exchange-traded fund (ETF) that would be highly competitive in terms of fees and aim to rival 10 other competitors in the market.
Grayscale’s new ETF (Bitcoin Mini Trust) will set fees at just 0.15%, according to its latest filing with the SEC.
Grayscale’s Mini Bitcoin Fund
Reacting to the news on April 21, Bloomberg ETF analyst Eric Balchunas exclaimed:
“Wow, the GBTC mini Bitcoin ETF will have a 15 basis point fee, which means Grayscale will have the cheapest Bitcoin ETF on the market.”
He went on to say that this is just an assumption and does not mean that the fund’s fees will definitely be 15 basis points. “But the good news is that they had to pick a fee and realized that everyone was watching, so they picked 15 basis points as a tentative fee,” he further explained.
The existing Grayscale Bitcoin Trust charges a 1.5% fee, which partly explains why it has lost a large amount of assets under management compared to competitors with lower fees.
The Franklin Bitcoin ETF (EZBC), currently the new fund’s closest competitor, has an expense ratio of 0.19%.
Additionally, according to the filing, when the Bitcoin Mini Trust (BTC) launches, the company will invest 10% of GBTC assets into the new fund.
As of this writing, this equates to about 30,500 bitcoins, worth roughly $2 billion, but if GBTC continues to experience steady outflows ahead of the launch of the Mini Bitcoin Fund, this number could be lower than this asset valuation.
In addition, shares of the new fund will be automatically issued and distributed to GBTC stock holders.
Since converting to a spot ETF in mid-January, GBTC has lost more than 50% of its Bitcoin holdings. Following an outflow of $45.8 million on Friday, the fund's remaining total is 304,970 BTC.
Last week, Grayscale lost $458 million, although outflows began to slow towards the weekend. In addition, April 19 was the first day in a week that total inflows reached $59.7 million.
ETH ETF may not be approved
On April 19, ETF Store President Nate Geraci said that the spot ETH ETF was “unusually quiet.”
He confirmed that the consensus among industry analysts is that the applications are expected to be rejected by the U.S. Securities and Exchange Commission (SEC) in late May due to a lack of participation. #BitcoinETF #Grayscale
