10 months ago
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Asset management firms have cut fees on their Bitcoin exchange-traded funds (ETFs) in Europe by over 60% to compete with products now available to U.S. investors.
In an interview with the Financial Times, Gary Buxton, Invesco head of ETFs for Europe, the Middle East and Africa, and Asia Pacific, said many ETF providers have lowered their fees on their spot Bitcoin ETFs in response to the competitive landscape in the U.S. market.
Cathie Wood’s Ark Investment Management, initially indicating a 0.8% fee for its spot Bitcoin ETF, eventually launched with no fees for the first six months or until assets reach $1 billion. BlackRock‘s investors will pay 0.25%, with early investors accessing it at 0.12% for the first year until assets reach $5 billion.
“The launch of spot bitcoin ETFs in the U.S. is helping the crypto market to evolve as the asset class continues to stake a claim for a place in client portfolios.”
WisdomTree Europe head Alexis Marinof
Executives say the U.S. “price wars” seem to have settled around 30 basis points, adding that below the threshold, providers may struggle to be profitable unless they attract substantial assets under management, leading to potential closures in the medium term. As crypto.news reported earlier, Grayscale Investments CEO Michael Sonnenshein believes that less than five Bitcoin ETFs will survive in the long run, and even fewer may attain “critical mass.”
To compete with other markets, American asset managers WisdomTree and Invesco have cut fees by over 60% on their European-listed spot Bitcoin ETFs. As a result, WisdomTree’s Physical Bitcoin ETF will see fees drop from 0.95% to 0.35%, while Invesco’s Physical Bitcoin ETF fees will decrease from 0.99% to 0.39%.
The changes are expected to take effect by February. Invesco will also waive fees for its U.S. product for the first six months or until it reaches $5 billion, after which it will charge 0.39%, aligning with the newly announced fee on its European product.
The U.S. Securities and Exchange Commission gave the green light to multiple spot Bitcoin ETFs on Jan. 10. However, after the launch, SEC Chair Gary Gensler issued a statement, saying that the SEC “did not approve or endorse Bitcoin.”
