Bitcoin ETF Market Share War Intensifies As Invesco And Galaxy Slash Fee

Updated: 30 January 2024

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Invesco and Galaxy Asset Management have reduced the fee for their spot Bitcoin ETF (exchange-traded fund) by 35% amid stiff competition from titans including Blackrock and Fidelity.

The Invesco Galaxy Bitcoin ETF (BTCO) slashed fees to 25 basis points, from 39 basis points previously, and will waive fees altogether during the first six months or until the product reaches $5 billion in assets.

We have @InvescoUS & @galaxyhq cutting the long term fee on their #Bitcoin ETF from 39 bps to 25 bps.

(Yes they have the fee waiver to 0% for first 6 months or $5 billion in assets). Story from @emily_graffeo & @kgreifeld pic.twitter.com/Erk2NU9kVF

— James Seyffart (@JSeyff) January 29, 2024

BTCO is competing in an already crowded market that’s dominated by BlackRock, Fidelity, and Grayscale.

BTCO has around $287 million in assets, ranking it fifth among the 11 spot BTC ETFs. BlackRock and Fidelity have a combined $4 billion in assets under management.

Despite the reduction, BTCO is not the cheapest spot BTC ETF. Franklin Templeton currently has the lowest fee of 0.19% while Bitwise and ARK 21Shares charge 0.20% and 0.21%, respectively. Grayscale charges the most, at 1.5%.

Spot Bitcoin issuers started slashing fees even before the US Securities and Exchange Commission (SEC) approved the products on Jan. 10.

Wall Street Dominates Spot Bitcoin ETF Market

Wall Street giants BlackRock and Fidelity command around 70% of all spot Bitcoin ETF inflows. On day 12 of trading, Fidelity had the highest inflows of $208 million, while BlackRock followed closely behind with $198 million.

Bitcoin ETF Flow – Day 12

All data out. Strong day, with $255m net inflow overall pic.twitter.com/XPQNz496gj

— BitMEX Research (@BitMEXResearch) January 30, 2024

The top players dwarf the inflows of other issuers. ARK 21Shares posted $20 million in inflows on January 29, Bitwise ranked fourth with $17 million in inflows, while Invesco Galaxy had only $3 million.

Grayscale’s outflows eased to $191 million on Monday.