Bitcoin ETF starting gate: A look at the spot funds set to start trading today

The US Securities and Exchange Commission cleared nearly a dozen spot bitcoin ETFs Wednesday, with most now expected to start trading.

The SEC first approved what are known as 19b-4 proposals filed by the Cboe BZX Exchange, Nasdaq and NYSE Arca — the stock exchanges on which the funds are to be listed.

Registration statements, or S-1s, by the issuers were then made “effective” — a final step toward launch.

While a rule change to list Hashdex’s bitcoin futures fund as a spot product was approved, its registration statement to convert the fund is still under SEC review, the firm said Thursday.

With a bunch of similar ETFs set to launch Thursday, industry watchers have said competition among the bitcoin funds will be fierce. The various asset managers have so far looked to differentiate via low fees and marketing campaigns.

Here’s a look at the issuers set to launch the first spot bitcoin ETFs in the US.

BlackRock

Fund name: iShares Bitcoin Trust (IBIT)

Exchange: Nasdaq

Fee: 0.25% (0.12% for the first 12 months, or $5 billion)

BlackRock entered the spot bitcoin ETF race last June. The move from the world’s largest asset manager was seen by many as positive, given its TradFi standing, size and stellar record of getting funds approved by the SEC.

The team at BlackRock was busy in November and December, meeting with the SEC five times. In total, the SEC held over 20 meetings with potential issuers.

Neena Mishra, director of ETF research at Zacks Investment Research, previously told Blockworks she would bet on BlackRock’s spot bitcoin ETF to gain the favor of many investors.

“What’s not to like about a low-cost product from the world’s largest asset manager that seems perfect for an advisor or investor looking for safe and convenient bitcoin exposure?” she said.

Fidelity

Fund name: Fidelity Wise Origin Bitcoin Fund (FBTC)

Exchange: Cboe BZX

Fee: 0.25% (0.0% through July 31, 2024)

Like BlackRock, Fidelity is one of the largest financial companies in the world — with $11.5 trillion assets under administration.

The financial services giant rejoined the spot bitcoin race last June, having previously filed for the Wise Origin Bitcoin Trust in 2022. Fidelity’s Canadian subsidiary previously launched a similar product on the Toronto Stock Exchange.

As for fees, the firm announced a fee of 25 basis points, lowering its fee earlier this month after previously proposing a 39 basis point fee. The fund is also waiving the fee until July 31, 2024.

Ark Invest, 21Shares

Fund name: Ark 21Shares Bitcoin ETF (ARKB)

Exchange: Cboe BZX

Fee: 0.21% (0.0% for first six months, or $1 billion)

The 2023 proposal from Ark Invest and 21Shares was the first in line for approval or denial by the SEC. The agency had until Jan. 10 to make a decision following multiple delays.

Unlike BlackRock, Ark Invest and 21Shares previously filed for a spot bitcoin ETF — though, like it did to others, the SEC blocked the bid. 21Shares operates a number of crypto exchange-traded products in Europe.

Ark Invest CEO Cathie Wood correctly predicted that while her firm was first in line, the SEC was likely to approve multiple such funds at once.

Similar to other issuers, Ark and 21Shares lowered its fee ahead of the SEC decision, dropping the price point by four basis points in a Wednesday filing.

Ark Invest exited its position in the Grayscale Bitcoin Trust (GBTC) ahead of the SEC approval. The move was seen by Bloomberg Intelligence analyst Eric Balchunas as a way for the company to potentially give its “own ETF a nice [assets under management] boost.”

Bitwise

Fund name: Bitwise Bitcoin ETF (BITB)

Exchange: NYSE Arca

Fee: 0.20% (0.0% for first six months, or $1 billion).

Bitwise filed for a physically backed bitcoin ETF in 2019, but withdrew its request in January 2020 amid SEC concerns. The crypto-focused fund group would start another unsuccessful attempt in October 2021.

It then was among the issuers that refiled for such a fund in the weeks after BlackRock revealed its proposal last June. Bitwise most recently published research in September addressing rebuttals to various bitcoin ETF filings over the years.

Bitwise was one of the first to market its ETFs prior to approval. The firm tapped actor Jonathan Goldsmith — known as the most interesting man in the world from Dos Equis ads — for several spots.

Grayscale

Fund name: Grayscale Bitcoin Trust (GBTC)

Exchange: NYSE Arca

Fee: 1.5%

Grayscale is a bit different from the other issuers, as it filed to convert its existing Grayscale Bitcoin Trust (GBTC) to an ETF. It thus comes in to spot bitcoin ETF launch day with a large asset base.

GBTC launched in 2013 and has more than $28 billion in assets under management. The trading of GBTC had historically been limited to OTCQX.

The SEC denied the conversion in 2022, spurring Grayscale to sue the regulator. A panel of judges ruled in favor of Grayscale last August, ordering the SEC to reconsider it.

The Grayscale ETF is set to carry a significantly higher price point than competitors, though it is lower than the 2% annual fee it previously charged.

Valkyrie

Fund name: Valkyrie Bitcoin Fund (BRRR)

Exchange: Nasdaq

Fee: 0.25% (0.0% for first three months)

The crypto asset manager re-entered the spot bitcoin ETF race after BlackRock in June.

Valkyrie manages an ETF that holds the stocks of bitcoin mining companies, as well as a fund that invests in bitcoin and ether futures contracts.

“Our goal isn’t to be the lowest fee provider,” Valkyrie co-founder Steven McClurg told Blockworks Tuesday. “We’re very thoughtful about how we run our products; we’re really going to be focusing on performance.”

VanEck

Fund name: VanEck Bitcoin Trust (HODL)

Exchange: Cboe BZX

Fee: 0.25%

VanEck was previously unsuccessful in launching a spot bitcoin ETF, as the SEC denied its application for such a fund in 2021. The company renewed its efforts in June in response to BlackRock’s filing.

The firm has nearly 70 ETFs trading in the US with combined assets under management of $65 billion, according to ETF.com.

VanEck previously launched a bitcoin futures ETF in 2021 and an ether futures ETF last year. It posted a bitcoin ad teaser on X last month after Bitwise and Hashdex revealed commercials on their own accounts.

WisdomTree

Fund name: WisdomTree Bitcoin Trust (BTCW)

Exchange: Cboe BZX

Fee: 0.30% (0.0% for first six months, or $1 billion)

WisdomTree, a firm that surpassed $100 billion in assets under management last month, renewed its spot bitcoin ETF effort in the days following BlackRock’s June filing.

“The bitcoin market has matured such that it is operating at a level of efficiency and scale similar in material respects to established global equity, fixed income and commodity markets,” the firm noted in a filing at the time.

WisdomTree last year launched a “blockchain-native” app where consumers can buy and sell bitcoin and ether, as well as digital funds that keep a record of investor share ownership on the Stellar or Ethereum blockchains.

Franklin Templeton

Fund name: Franklin Bitcoin ETF (EZBC)

Exchange: Cboe BZX

Fee: 0.29%

Franklin Templeton, like BlackRock and Fidelity, is a household name in traditional finance circles. The firm manages roughly $1.5 trillion in assets.

The company joined the bitcoin ETF race a bit later than others, filing for one in September — several weeks after Grayscale’s court win against the SEC.

Roger Bayston, the firm’s head of digital assets, told Blockworks in June that blockchain technology is set to be “transformational” for capital markets.

Invesco, Galaxy Digital

Fund name: Invesco Galaxy Bitcoin ETF (BTCO)

Exchange: Cboe BZX

Fee: 0.39% (0.0% for first six months, or $5 billion)

Invesco’s latest spot bitcoin ETF bid — with partner Galaxy Digital — commenced in June just days after BlackRock’s filing.

The firms had first teamed up to build a crypto ETF suite in September 2021.

Invesco is perhaps best known for its QQQ ETF, which holds Nasdaq 100 companies. About half of the company’s nearly $460 billion of US ETF assets under management reside in that fund.

Hashdex

Fund name: Hashdex Bitcoin ETF (DEFI)

Exchange: NYSE Arca

Fee: 0.94%

Brazil-based Hashdex started offering a spot bitcoin ETF in Brazil in August 2021.

The asset manager filed in August to modify its Bitcoin Futures ETF (DEFI) in the US to a fund that also holds bitcoin directly.

Though a rule change to list Hashdex’s bitcoin futures fund as a spot product was approved Wednesday, the firm noted its registration statement to convert the fund remains under SEC review.

Hashdex has released bitcoin ads on X in recent weeks, touting its focus on the crypto segment.

“We believe investors will gravitate towards thematic asset management experience with a sole focus on digital assets and bitcoin, with extensive experience running bitcoin ETFs in several markets,” Hashdex marketing head Chris Glendening told Blockworks last month.

Casey Wagner contributed reporting.

Updated Jan. 11, 2024 at 5:20 pm ET: Noted that Hashdex’s bitcoin futures fund has not yet converted to a spot product after the firm issued a corrected press release late Thursday.

Updated Jan. 11, 2024 at 9:50 am ET: Changed Valkyrie fee to 0.25% from 0.49%.

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