Several applicants, including BlackRock, Ark Invest/21Shares, VanEck, WisdomTree, Invesco, Fidelity, and Valkyrie, have submitted revised S-1 forms. This is the final stage before the potential approval of a spot Bitcoin ETF.
Expected modifications to the S-1 forms are predicted to reveal details about the fees or the identities of the market makers for the prospective ETFs, as per a Reuters report dated January 5. The specifics in the report align with the data gathered by Eric Balchunas, a Bloomberg ETF analyst, who also forecasted that the “final S-1s” would be submitted on January 8.
Yeah it’s basically done. Latest I’m hearing (from multiple sources) that final S-1s are due 8am on Monday as SEC is trying to line everyone up for Jan 11th launch. That said, I still want to hear it from the SEC to call it official.
— Eric Balchunas (@EricBalchunas) January 5, 2024
BlackRock has established its sponsor fee at 0.3%, which will be reduced to 0.2% for the first year or until the ETF reaches $5 billion in assets. VanEck has opted for the joint lowest permanent fee among the issuers so far at 0.25%. WisdomTree has chosen a higher fee of 0.5%.
BlackRock Sets the Bar Low with a 0.3% Sponsor Fee
Bloomberg ETF analyst Eric Balchunas commented on the fee for BlackRock’s Bitcoin ETF, which will be 0.30% according to their recently filed S-1. He noted that this is significantly lower than he anticipated, making the competition much more challenging for others. He referred to the situation as the “ETF Terrordome.”
Ark/21Shares has also reduced its fee from 0.8% to 0.25% to increase its competitiveness. It will not charge any fees for the first six months or until the ETF reaches $1 billion in assets. Balchunas remarked on ARK’s fee reduction, describing it as “breathtaking.”
He pointed out the intensity of the fee wars but noted that ARK’s drastic reduction was necessary given BlackRock’s potential to instantly outcompete anyone with a significantly higher fee.
Meanwhile, the crypto community is eagerly awaiting the potential approval of a spot Bitcoin ETF by the U.S. SEC, expected by January 10. ARK, the investment firm led by Cathie Wood, and its European associate 21Shares, are at the forefront of the SEC’s decision-making process scheduled for January 10. Some market observers anticipate that several ETFs could receive approval on the same day.