The spot Bitcoin (BTC) exchange-traded fund (ETF) fee war has spilled over into Europe just weeks after the U.S. Securities and Exchange Commission (SEC). Approved domestic BTC ETF.
Prior to the Jan. 10 approval, multiple applicants updated their S-1 applications multiple times to reduce ETF fees. A similar trend is currently being observed in European exchange traded products (ETPs).
Two major asset management companies, Invesco and WisdomTree, have slashed fees for European-listed ETPs by more than 60%. The $137 million Invesco Physical Bitcoin ETP reduces fees from 0.99% to 0.39%, and the $325 million WisdomTree Physical Bitcoin ETP reduces costs from 0.95% to 0.35%. Masu.
In Europe, digital asset exchange traded products are structured as exchange traded securities (ETNs) rather than funds. ETN investors own debt securities, while ETF shareholders own a portion of the fund's underlying assets.
The significant reduction in fees is due to increased competition in the US, one of the major financial markets, and the availability of multiple ETFs. Previously, US-based investors had to look to Canadian and European-based ETPs for investment. However, the approval of 11 spot BTC ETFs in the US has significantly reduced demand for European ETPs from US investors.
Related: SEC did not “approve or support” Bitcoin with approval of Spot BTC ETF — Gary Gensler
in interview Gary Buxton, Invesco's head of European ETFs, told the Financial Times that several U.S. ETFs have lowered fees to find “a new equilibrium between supply and demand,” resulting in lower fees than existing ETPs in Europe. He said prices have dropped significantly.
Compared to their European alternatives, US-based Bitcoin ETFs are more liquid and available on a single exchange platform, making them more accessible to European investors. The newly launched Spot Bitcoin ETF in the US has attracted billions of dollars in trading volume since its first day, and two weeks later, it is still trading billions of dollars every day.
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