KEY POINTS
- The planned BTC Trust will only have a 0.15% fee, compared to GBTC's 1.5%
- Bloomberg analyst Eric Balchunas noted that the planned fee is still "hypothetical"
- Grayscale has seen massive Bitcoin outflows in recent months
Asset management titan Grayscale has unveiled the details of its new planned product, the Bitcoin Mini Trust (BTC Trust), which will have a significantly lower fee than other issuers of spot Bitcoin exchange-traded funds (ETFs).
Grayscale said in its latest filing with the U.S. Securities and Exchange Commission (SEC) that the mini spinoff of its Grayscale Bitcoin Trust (GBTC), the BTC Trust, will have a 0.15% fee, which could be the lowest fee among all issuers of spot Bitcoin ETFs – even much lower than GBTC, which has a 1.5% fee, the highest among issuers.
Once the mini version of GBTC goes live, Grayscale said the company will contribute 10% of the GBTC's assets, or 63,620 Bitcoins to the BTC Trust, and shares of the smaller spot Bitcoin ETF will be issued automatically to GBTC holders.
While the news could be big in the cryptocurrency industry as the BTC Trust could make history as the spot BTC ETF with the lowest fee if other issuers don't shrink their fees, some analysts indicated that there were motives behind the said fee and it may be too early to celebrate.
Bloomberg analyst Eric Balchunas pointed out that Grayscale's latest filing was a pro forma – financial statements that project the expected performance of a company in the future – which means the mini trust's planned fee is still "hypothetical" at this point.
UPDATE: so this is pro-forma financials and as such hypothetical. It doesn't nec mean $BTC will be 15bps. But the good news is they had to pick a number for this and knew ppl would be watching and they decided on 15bps. Anyway, do with that what you will. Updates as I get them!…
— Eric Balchunas (@EricBalchunas) April 20, 2024
CEO of Bitcoin business review site Apollo Sats, Thomas Fahrer, noted that Grayscale already lost more than 300,000 Bitcoins since launching. "They needed to plug the leak," and a GBTC spinoff with a lower fee "should do it," he said.
🚨 Grayscale offering cheap (15bps) ETF alternative
— Thomas | heyapollo.com (@thomas_fahrer) April 20, 2024
A new ETF that GBTC holders will be able to transfer to without tax implications.
Grayscale has lost 315K #BTC in outflows since launching, and they needed to plug the leak.
This should do it 🚀🚀 pic.twitter.com/himCFc2PuQ
Grayscale's latest disclosure comes over a week after the asset management giant was spotted moving 6,200 BTC, worth around $442 million at the time of the transfer, to Coinbase as the company saw significant outflows in its Bitcoin reserves.
Just one day before the said transfer, Bitcoin-focused firm Swan revealed that the GBTC saw an outflow of $303.3 million. Prominent blockchain analysis firm Arkham Intelligence also predicted in March that Grayscale may only have "14 weeks until they run out for good" of Bitcoin reserves, considering how its BTC holdings have plummeted significantly from 618,000 Bitcoins in January 2024 to around 356,000 BTC.
As of Tuesday last week, Grayscale said it only holds 309,871 Bitcoins, which means the company's total BTC holdings have been split by more than 50% since the SEC approved spot Bitcoin ETFs.
Grayscale has yet to announce an official date for the BTC Trust's launch.
