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Grayscale Investments to Launch Cheaper 'Mini' Bitcoin ETF Amid GBTC Outflows

Algoine News
Grayscale Investments plans to launch a "mini" version of its Bitcoin Trust, with a proposed fee of 0.15%, making it the cheapest among approved spot Bitcoin ETFs. However, potential alterations may be made before its introduction. The move follows significant outflows from Grayscale's current GBTC product since the introduction of Bitcoin ETFs in January.
Grayscale Investments has revealed that its soon-to-launch smaller variant of the Grayscale Bitcoin Trust (GBTC) exchange-traded fund (ETF) will be approximately 90% less expensive than present GBTC costs, making it the most affordable offering among the sanctioned bitcoin spot ETFs. However, Bloomberg analyst, Eric Balchunas cautions investors not to celebrate prematurely. He pronounced in an April 20 post on X that this a theoretical financial model and alterations could be made before launch. These cheaper fee rates are designed to attract investors. Grayscale's recent submission to the U.S Securities and Exchange Commission (SEC) proposes a charging structure for their forthcoming Grayscale Bitcoin Mini Trust (BTC) that's a tenth of GBTC's current 1.5% fee. Proposing a mere 0.15% fee, Grayscale aims to position their ETF as the least-expensive among the 11 Bitcoin ETFs authorized in January, with Franklin Templeton narrowly trailing at 0.19%. Bitwise Bitcoin ETF (BITB) and VanEck Bitcoin Trust (HODL) both propose a 0.20% fee. Thomas Fahrer, the CEO of crypto-centric review platform Apollo, notified his 42,900 X followers in an April 21 post that Grayscale's adoption of more cost-effective alternative fees was a needed measure to offset the high amount of GBTC withdrawals. Grayscale has witnessed a loss of 315K BTC due to outflows since its inception, and the firm needed a strategy to stymie the financial haemorrhaging, according to Fahrer. The announcement is timely as a growing number of investors are moving funds away from GBTC since the inauguration of Bitcoin ETFs in January, which present a more striking fee structure for Bitcoin investment. Data from Farside states that there have been roughly $16.73 billion outflows from GBTC following the launch of Bitcoin ETFs on Jan.11. Cointelegraph recently disclosed that shares of the new Bitcoin trust are set to be assigned to established GBTC stakeholders. Additionally, GBTC will contribute an unspecified quantity of Bitcoin to the fresh trust.

Published At

4/21/2024 4:57:44 AM

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