SEC Decision on Bitcoin ETFs Awaited as Applicants Revise Fee Structures
Summary:
The US Securities and Exchange Commission (SEC) decision is anxiously awaited regarding the Bitcoin (BTC) exchange-traded funds (ETF) after several applicants amended their final S-1 forms on January 8. To increase competitiveness, many of these applicants, including Valkyrie, WisdomTree, BlackRock, VanEck, Invesco, Galaxy, Grayscale, and ARK Invest and 21Shares, revised their fee structures. With the amendments submitted, the SEC is expected to proceed towards a formal vote.
The market is eagerly awaiting the decision of the United States Securities and Exchange Commission (SEC) on the spot Bitcoin (BTC) exchange-traded fund (ETF), following recent final S-1 form amendments submitted by several applicants on January 8. Valkyrie led the procession of submissions, followed by WisdomTree, BlackRock, VanEck, Invesco, Galaxy, Grayscale, and ARK Invest and 21Shares.
Many of the applicants took advantage of the amendment process to include revised fees, increasing the level of competition between the various ETF plans. Bitwise boasts the lowest Sponsor Fee among all ETF applications, offering no charge for the first six months or on their first $1 billion in assets, subsequently instating a fee of just 0.24%. ARK Invest and 21Shares followed suit with a similarly introductory fee structure, though their subsequent charge sits slightly higher at 0.25%.
Financial markets commentator Eric Balchunas underlined the significance of ARK and 21Shares' fee drop from 0.80% to 0.25% as extraordinary. He noted that competition over fees is fierce but this was a next-level move.
VanEck and Franklin priced their fees at 0.25% and 0.29% respectively, whereas Fidelity listed a fee of 0.39%. Global asset manager BlackRock set the fee for its iShare ETF at 0.20% for the inaugural 12 months or until the first $5 billion in assets, afterwards increasing it to 0.30%.
At the pricier end of the scale, WisdomTree listed a 0.5% fee, followed by Galaxy Invesco's 0.59% after six months with no charge, Valkyrie's 0.80%, and Hashdex's 0.90% sponsor fee. Grayscale reduced its fee from 2% to a still substantial 1.5%, making it the most costly among the latest entries.
Financial analyst James Seyffart reminded that these fee structures aren't yet final and suggested further reductions could be on the horizon. Likewise, Balchunas hinted at the possibility of crypto exchanges making their own fee adjustments in response to these revisions, before it becomes a missed opportunity.
With the final amendments submitted, the SEC commission is expected to proceed towards a formal vote. Market analysts are predicting the ETF to surface on or around January 11.
Published At
1/8/2024 4:56:56 PM
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