Nearly $650 million in capital outflows in one day! Grayscale Bitcoin Spot ETF: Promises to Lower Fund Rates…
Financial News (Hong Kong) News: The wave of Bitcoin spot ETFs is coming, and when giants such as BlackRock offer preferential rates, more and more funds are flowing out of Grayscale, where they initially entered the market. On Monday (March 18), Grayscale’s GBTC experienced an outflow of nearly US$650 million in one day. Now, the fund is promising to lower fund fees.
Grayscale CEO Michael Sonnenshein expressed optimism about fee cuts as total outflows from the company’s flagship Grayscale Bitcoin Trust, GBTC, hit a staggering $12 billion. #SpotBitcoinETF#
In an interview with CNBC, Sonnenshein addressed concerns about GBTC’s higher-than-average fees.
He believes fees will fall over time as the Bitcoin spot ETF market matures.
The concerns come amid outflows of more than $12 billion since Grayscale GBTC switched from a trust fund to a Bitcoin spot ETF.
This outflow trend is mainly attributed to the fees of its Bitcoin spot ETF products, which are higher than those of BlackRock, Fidelity, Invesco, etc.
“I am pleased to confirm that over time, as this market matures, GBTC fees will decrease,” Sonnenshein said.
Grayscale, meanwhile, has defended its above-market-average fees in the past.
BitMEX Research data shows that GBTC experienced its largest single-day outflow on Monday, withdrawing US$643 million. Moreover, data shows that since the launch of the U.S. Bitcoin Spot ETF on January 11, Grayscale’s ETF has not recorded positive flows.
In contrast, Bitcoin spot ETFs from other asset managers such as BlackRock, Fidelity, Bitwise and Ark Invest continue to see significant positive inflows.
Interestingly, Sonnenshein noted that the company had anticipated the outflow, suggesting it was not a surprise.
CNBC quoted market analysts as saying that they believe the bankruptcy of crypto exchange FTX played an important role in the sell-off of GBTC.
Notably, FTX was the primary holder of GBTC before filing for bankruptcy in 2022.
As of October 2022, FTX held approximately 22 million shares.
Meanwhile, the FTX bankruptcy estate sold a majority of its stake in the Grayscale Bitcoin ETF after the ETF was approved, which temporarily affected the price of Bitcoin.
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