Fee War Intensifies Among Spot Bitcoin ETF Issuers
Issuers of spot Bitcoin ETFs are engaged in a fee war as demand and inflows into these funds continue to grow. Investco and Galaxy Digital have announced a reduction in their spot Bitcoin ETF fees by 35%, bringing the expense ratio down to 0.25% from the previous rate of 0.39%. The Invesco Galaxy Bitcoin ETF (BTCO) will also waive its fees for the initial six months or until it reaches $5 billion in assets, whichever comes first.
Lower Costs Precede Approval of Spot Bitcoin ETFs
This move follows the trend of issuers lowering costs in the industry, even before the approval of spot Bitcoin ETFs by US regulators. BlackRock Inc. and Fidelity, two major players, have already attracted around $4 billion in investor inflows, accounting for 70% of total spot Bitcoin ETF inflows. Despite the fee reduction, BTCO is not the cheapest spot Bitcoin ETF available, with Franklin Templeton’s fund boasting a post-waiver expense ratio of 0.19%.
Bitcoin Price Surges Amid Positive Developments
The recent developments in the spot Bitcoin ETF market have served as a catalyst for the price of Bitcoin. Analysts predict that the price could surge to $50,000 before the next Bitcoin halving in April 2024. Anthony Scaramucci, founder of SkyBridge Capital, even anticipates a price of $170,000 per coin after the halving. This projection is based on Bitcoin’s historical pattern of reaching new all-time highs after each halving event.
Hot Take: Positive Market Sentiment Boosts Bitcoin Price Outlook
The fee reduction by Investco and Galaxy Digital, along with the growing popularity of spot Bitcoin ETFs, has created positive market sentiment for Bitcoin. Analysts and industry veterans are optimistic about the price potential of Bitcoin, with some predicting a surge to $170,000 per coin after the halving in April 2024. These developments highlight the increasing mainstream acceptance and adoption of cryptocurrencies, particularly Bitcoin, as an investment asset class.
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