Spot Bitcoin ETF: Last Glimpse Into Applicant’s Fee Structure

With today likely to be a pivotal moment for the crypto ecosystem as at least one spot Bitcoin ETF product might be approved by the United States Securities and Exchange Commission (SEC), here’s the overview of the fee rate per the latest filings from prospective issuers.

The race toward spot Bitcoin ETF is almost over as every applicant has one incentive or the other targeted toward attracting a larger market share. One defining difference, however, is the fee each applicant hopes to charge if the Bitcoin ETF goes live for trading as projected.

Spot Bitcoin ETF Fee Outlook

The liberty that spot Bitcoin ETF applicants have to set their respective fees has sparked a seemingly tough marketing war across the board. A total of six applicants including Bitwise, Ark 21Shares, Fidelity Investments, WisdomTree, Invesco Galaxy, and Valkyrie have announced waivers for the fees upon launch. 

Except for Valkyrie whose waiver is for 3 months and Fidelity Investments whose waiver will span until July 31, the remaining four applicants pegged their 0% waivers for 6 months. Of these firms, Bitwise has the lowest fee schedule pegged at 0.2% per the firm’s latest filing on January 9. 

Ark 21Shares pegged its fee at 0.21% after the waiver period or the first $1 billion volume is recorded. Fidelity Investments pegged its fees at 0.25% while WisdomTree, Invesco Galaxy, and Valkyrie fixed their rates at 0.3%, 0.39%, and 0.49% respectively.

Update: Here's how things look in the #Bitcoin ETF fee war after moves by Ark/21Shares and BlackRock to lower their fees. pic.twitter.com/2o3J74JReD

— James Seyffart (@JSeyff) January 10, 2024

Investment management giant, BlackRock planned to charge 0.12% for the first 12 months or after hitting a volume of $5 billion. Afterward, it plans to charge 0.25%. VanEck, Franklin Templeton, Hashdex, and Grayscale Investments have no waivers, and their fees are pegged at 0.25%, 0.29%, 0.9%, and 1.5% respectively.

Enhance Commercials Expected Soon

In a bid to properly position the mainstream market, the approval of these spot Bitcoin ETF products will mark an endorsement move from the regulator for the nascent asset class. 

This approval might usher in intense advertisements as each issuer will look to outpace the other with enticing commercial themes. Already, Bitwise and VanEck have released their commercials for the product and others are expected to join the train moving forward.