Daisy Watts 
Jan 18, 2024
Recent US bitcoin exchange-traded funds (ETFs) have captured significant attention from investors, as in the initial three days of trading, nine new ETFs linked to the spot price of bitcoin attracted a total investment of $1.9 billion.
During the three-day trade, industry leaders BlackRock and Fidelity dominated the majority of these capital inflows. The data has been published provided by the issuers and crypto industry analysts.
The combined investments in the nine funds exceeded the post-launch inflows of the ProShares Bitcoin Strategy ETF, which set a record with $1.2 billion in the initial three days of trading following its 2021 debut, as reported by Reuters.
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Despite receiving approval from the US Securities and Exchange Commission (SEC) on January 10, the long-anticipated ETFs, launched on January 11, failed to meet the most optimistic projections for first-day flows.
Since January 11, Bitcoin has experienced a decline of over 8%, reversing its earlier surge fueled by expectations that the SEC would approve the ETFs.
As of now, it seems that the main attractions for investors are the lower fees and the well-established reputation of the iShares Bitcoin Trust ETF.
BlackRock is imposing a fee of 0.12% for the initial $5 billion in assets and the first year of trading, with an increase to 0.25% thereafter. Meanwhile, Fidelity is charging nothing initially, which will elevate to 0.25% after July 31.
These fees, even at their higher points, remain below half of the average ETF fee, which stands at 0.54%, according to calculations by Morningstar Inc.
CF Benchmarks CEO said, “Fees are clearly a key determinant for success,” which is providing the index against which six of the new ETFs will be measured.
The CEO added that "those that charge the lower management fees will unsurprisingly make themselves more appealing compared to their peers. Brand recognition is another core aspect."
