BlackRock, ARK Invest, and Bitwise compete to offer low-cost access to Bitcoin

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Leading investment managers, including BlackRock, ARK Invest, VanEck, and Bitwise, have recently filed amended S-1 forms to lower their spot Bitcoin exchange-traded fund (ETF) management fees, according to the latest U.S. Securities and Exchange Commission (SEC) updates.

The management fees by the issuer are listed as follows:

• BlackRock charges a management fee of 0.2% during the first year or until the ETF reaches $5 billion in assets. After this threshold, the fee increases to 0.3%.
• Ark Invest offers zero management fees for the first six months or until the ETF hits $1 billion in assets. After that, a fee of 0.25% is applied.
• Bitwise offers a fee waiver for the first six months or up to the first $1 billion in assets. After that, a management fee of 0.24% is levied.
• VanEck charges a flat rate of 0.25%.
• Franklin Templeton, Fidelity, WisdomTree, Valkyrie, and Hashdex offer fees of 0.29%, 0.39%, 0.5%, 0.8%, and 0.9%, respectively.
• The Invesco & Galaxy fund offers zero fees for the first six months and the first $5 billion. After this period, a fee of 0.5% is applied.
• Grayscale charges 1.5%, making it the most expensive option.

Source: Bloomberg Intelligence, SEC.gov

Notably, BlackRock, VanEck, Ark Invest, and Bitwise aim to offer ETF management fees that are lower than the general forecast of ETF analyst Eric Balchunas. Among the applicants, only Hashdex still needs to update its filings. However, Bloomberg analyst James Seyffart noted that Hashdex differs from the rest as it’s seeking to convert its futures Bitcoin ETF to a spot Bitcoin ETF.

While VanEck’s Bitcoin ETF isn’t the cheapest, 5% of profits will be donated to Bitcoin Core Development. Gabor Gurbacs, VanEck’s digital asset strategist, reminded in a tweet:

“VanEck’s approach to share a portion of Bitcoin ETF revenues with Bitcoin core developers is great. It’s much better to share revenues with the Bitcoin ecosystem and re-investing in Bitcoin companies than waiving fees for a few months. Bitcoin core development isn’t free.”

Word on the street is that this fierce race among spot Bitcoin ETF issuers to lower fees is a positive sign for approval odds. According to Duo Nine, a crypto educator and technical analyst, those amendments suggest a spot Bitcoin ETF will be launched soon.

Bitcoin ETF fees war is on! 🚨

🔸 BlackRock @ 0.3% per year
🔸 Ark @ 0.25% per year

Why would they amend their fees today LOWER unless this goes live soon? Get ready!

Being first matters. Bitcoin proved it already. pic.twitter.com/bHlNOKpnn7

— Duo Nine ⚡ YCC (@DU09BTC) January 8, 2024

With the final spot Bitcoin ETF filings in hand, the SEC has enough basis to decide whether to approve them. If approved, trading could begin within the next few days.

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