European Bitcoin exchange-traded products (ETPs) have seen over $500 million in net outflows this year, despite the rising demand for Bitcoin, according to data from Morningstar. This comes as competition intensifies from US-based counterparts. However, ETPs for other cryptocurrencies like Ether have absorbed $42 million within the same period.

The launch of US Bitcoin ETFs in January has increased interest in European crypto ETPs but also brought unprecedented competition, forcing European issuers to lower their fees. Asset managers BlackRock and Fidelity, for instance, now offer 0.25% annual management fees, prompting European Bitcoin ETP providers like Invesco, WisdomTree, and CoinShares to drop their previous fees from rates above 0.9% to below 0.4%.

Funds that failed to lower their management fee, such as Grayscale Bitcoin Trust and Canada's Purpose Bitcoin ETF, have suffered significant asset losses. Despite the competition, VanEck's CEO in Europe, Martijn Rozemuller, remains optimistic, stating that European crypto ETPs are still relatively larger than the spot Bitcoin ETFs in the US.