Grayscale Indicates Potential Fee Reduction for Bitcoin ETF

By: Eliza Bennet

Grayscale Bitcoin exchange-traded fund (GBTC) may witness a gradual decrease in fees as the market matures, as indicated by the company CEO Michael Sonnenshein. The firm previously maintained its ETF fees above the market norm but is now signaling a change. The currently levied 1.5% fee stands out against the competitors' range of 0.2% to 0.5%.

GBTC, since its January launch, has experienced outflows approximating $12 billion, which may be partly attributed to its higher fees. Despite this outflow, GBTC still holds the position of the largest Bitcoin ETF, with managed assets amounting to about $24.7 billion.

In response to these significant outflows, Grayscale has filed for a Mini Bitcoin Trust with the Securities and Exchange Commission (SEC). This upcoming product will feature reduced fees and be backed by some GBTC shares. Existing GBTC holders may transition to the new fund without incurring capital gains tax subject to approval.