On Monday, BlackRock, VanEck, and Ark/21Shares revealed their competitive edge by announcing reduced fees for their upcoming spot bitcoin exchange-traded funds (ETFs), intensifying the battle for market dominance ahead of the approval deadline.
BlackRock proposed a fee of 0.30%, while VanEck aimed lower at 0.25%. Notably, ARK 21Shares Bitcoin ETF also slashed its planned fee from an earlier 0.80% to match VanEck’s at 0.25%.
These substantially reduced fees compared to their counterparts escalate the rivalry among various contenders striving to secure a portion of the spot bitcoin ETF market.
This race pits crypto entities like Grayscale Investments against established financial giants like BlackRock. The expectation of a swift approval for this investment vehicle has bolstered bitcoin’s value and restored confidence in an industry unsettled by the FTX collapse in November 2022.
The push for cryptocurrency ETFs gained momentum last year following Grayscale’s hard-won legal victory against the Securities and Exchange Commission (SEC). In August, a federal appeals court ruled against the regulator’s rejection of Grayscale’s application for a spot bitcoin ETF, marking a pivotal shift.
Before this ruling, the SEC had turned down numerous similar proposals, citing concerns about anti-fraud measures and safeguarding investor interests.
These ETFs offer investors exposure to bitcoin without directly owning the cryptocurrency. Regulatory approval could potentially encourage institutional interest in the leading cryptocurrency, often avoided by institutions due to regulatory uncertainties.
While BlackRock, VanEck, and Ark/21Shares aimed for competitive fees, Grayscale, on the other hand, proposed a higher fee of 1.5% on Monday, setting itself apart in the fee structure.