In a bid to gain a competitive advantage, four spot Bitcoin ETF applicants have made last-minute fee reductions. Invesco, Bitwise, Valkyrie, and WisdomTree have all announced fee reductions in their latest amended applications for their spot Bitcoin ETFs.
Bitwise, which already had the lowest fee, has now reduced its fee to 0.20% from 0.24%. It has also introduced zero fees for the first six months or until it reaches $1 billion in assets. Invesco has also introduced zero fees for the first six months or until it reaches $5 billion in assets, with fees later set at 0.39%, down from 0.59%. Valkyrie has reduced its fee to 0.49% from 0.80%, and WisdomTree has cut its fee to 0.30% from 0.50%.
These fee reductions come at a crucial time, as the deadline for the SEC’s ETF approval decision approaches. The possibility of U.S. regulators approving a range of spot Bitcoin ETFs has led to heightened fee competition among issuers. By lowering their fees, these firms hope to attract more investment inflows and expand their market reach.
Bloomberg analyst Eric Balchunas tweeted, “Amazing, we down to 20bps, it’s like two years worth of fee war condensed into a couple of days… thought it would take us a lot longer to get to these levels.” Balchunas also noted that Vanguard, while not part of this fee race, is likely to follow suit.
The fee reductions by these ETF applicants indicate the intense competition in the Bitcoin ETF market. As more investors show interest in cryptocurrencies, ETF issuers are vying for a piece of the market by offering lower fees to attract investors. This fee war is expected to continue as the demand for Bitcoin ETFs grows.
Overall, the fee reductions by these four Bitcoin ETF applicants highlight the fierce competition in the market and the importance of offering competitive fees to attract investors. As the SEC’s ETF approval decision looms, it remains to be seen which ETF issuers will come out on top in this highly competitive landscape.
