Spot Bitcoin ETF applicants slash sponsor fees, with Bitwise dropping to 0.20%
Quick Take
- Bitwise set a record-low fee of 0.20% for its spot bitcoin ETF, awaiting an SEC decision expected on Wednesday.
Bitwise lowered the fee for its spot bitcoin exchange-traded fund down to 0.20% — the lowest among all the current offerings — according to an amended S-1 filing on Tuesday morning.
The fee war between spot bitcoin exchange-traded fund applicants has reached fever pitch. According to several market participants — including Valkyrie Investments co-founder and CIO Steven McClurg — the U.S. Securities and Exchange Commission might greenlight the first ETF on Wednesday evening, with trading potentially beginning on Thursday.
On Monday morning, a flurry of filings on the SEC website showed strong competition between the 13 current spot bitcoin ETF contenders, which tried to outbid each other by offering the lowest fees possible. Bitwise offered the lowest one, going with zero fees for the first six months or until the first $1 billion in assets, and 0.24% afterward. Today, Bitwise decided to go even lower by offering a 0.20% fee after the initial discount.
Multiple other competing issuers lowered their fees, too — with Valkyrie going from 0.80% to 0.49%, Invesco Galaxy from 0.59% to 0.39% and WisdomTree from 0.50% to 0.30%.
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Ark/21Shares is continuing to offer zero fees for the first six months or until the fund has $1 billion in assets, and 0.25% after that. Invesco/Galaxy is also offering zero fees for the first six months or until the first $5 billion in assets. BlackRock offered a steep discount, dropping the fee to 0.2% for the first 12 months or until the fund hits $5 billion in assets. After that, it will be 0.3%.
The market has been holding its breath expecting spot bitcoin ETFs to get approved and drive new large volumes into the dominant cryptocurrency. Bitwise said it anticipated the market for spot bitcoin ETFs to reach around $72 billion within five years.
Valkyrie is expecting up to $400 million to flow into its ETF in the first week and the entire market to reach up to $5 billion over the first several weeks of trading. VanEck estimated that $1 billion of funds would arrive in the first few days and $2.4 billion within a quarter. Galaxy expects $14 billion within the first year.
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