Main Points
- On January 29, the Fidelity Bitcoin ETF garnered $208 million in daily inflows, surpassing Grayscale’s GBTC for the first time since its launch.
-
Reduced fees in the U.S. ETF market could be incentivizing traders to transition from European ETFs. Invesco and WisdomTree have recently lowered fees on their European-based Bitcoin ETFs.
- BlackRock’s IBIT and Fidelity’s FBTC lead the spot Bitcoin ETF market, boasting daily volumes of $460.9 million and $315.4 million, respectively
Fidelity Bitcoin ETF Records Inflows, Grayscale Outflows For 5th Day
Reportedly, on January 29, Fidelity’s spot Bitcoin exchange-traded fund (ETF) achieved a notable milestone, attracting $208 million in daily inflows, surpassing outflows from the Grayscale Bitcoin Trust (GBTC) for the first time since their launches.
As per preliminary data from Farside Investors, Fidelity’s #FBTC saw $208 million in inflows on Monday, while GBTC recorded a daily outflow of $192 million. This marks GBTC’s lowest daily outflows since its re-launch, as indicated by BitMEX Research data.
The recent GBTC outflows represent a nearly 25% decrease from $255 million on January 26 and a significant 70% drop from its peak daily outflows of $641 million on January 22.
It’s worth mentioning that this is the second-lowest outflow day for Grayscale’s fund, with only $95 million leaving on January 11, the day it transitioned into a spot Bitcoin exchange-traded fund (ETF).
Fee reductions in spot Bitcoin ETFs are spurred by heightened competition.
In the competitive field of spot Bitcoin ETFs, BlackRock’s iShares Bitcoin Trust (IBIT) and Fidelity Bitcoin ETF have emerged as leading contenders, commanding significant daily volumes of $460.9 million and $315.4 million, respectively. Together, they represent 78% of the combined volume among nine new ETFs. To attract investors amidst increasing competition, fund issuers are reducing fees, as seen with Invesco and Galaxy Asset Management’s fee cut for their joint ETF, the Invesco Galaxy Bitcoin ETF (BTCO). This adjustment aligns BTCO with major players like BlackRock and Fidelity, offering zero fees for the first six months or until it reaches $5 billion in assets. Despite these developments, the approval process for the Spot XRP ETF is anticipated to be more challenging than that for the Spot Bitcoin ETF.
The Impact of Fee Wars: Traders Shifting from European to U.S. ETFs
Recent developments in the fee competition among exchange-traded funds (ETFs) in the United States are believed to be impacting Europe’s ETF market. Research conducted by CoinGabbar indicates speculation about traders shifting from Europe-based products to their U.S. counterparts.
On January 23, Invesco made a notable move in the fee reduction trend by reducing fees on its Europe-based Bitcoin ETF, slashing the expense ratio from 0.99% to 0.39%. Following suit, WisdomTree also adopted the fee-cutting strategy, reducing fees from 0.95% to 0.35%.
