Michael Sonnessien, CEO of Grayscale, announced lately when their company plans to lower fees for the Grayscale Bitcoin Trust (GBTC). This news surfaces as the fund experiences significant outflows, straining the Bitcoin market.
GBTC Fees Will Drop When This Happens
A Cointelegraph article stated that Sonnenshein expressed during an interview at Canaccord Genuity’s Digital Assets Symposium that the high fees for GBTC (Grayscale Bitcoin Trust) will decrease once Spot Bitcoin ETFs (Exchange Traded Funds) become more established. Currently, GBTC has the highest management fee of 1.5%, while other Spot Bitcoin ETFs have fees ranging from 0.19% to 0.39%.
Despite GBTC experiencing the greatest number of withdrawals among its competitors and having higher fees, Grayscale’s CEO remains untroubled. He has stated that he is content to wait out the situation.
During this time, Sonnenshein explained the implications of Spot Bitcoin ETFs reaching maturity. He mentioned that the market would stabilize once this occurred, and investors would focus on a select few of these ETFs. Currently, he thinks that these investments are still in their initial stage of acceptance, and there is room for more investor involvement.
According to Sonnenshein, those significant events have yet to occur. However, he is optimistic about the potential for expansion in the Spot Bitcoin ETFs market. Once the initial surge in acceptance takes place, fees are expected to decrease gradually. Consequently, GBTC’s fees may also be reduced during this next stage of adoption.
Grayscale Spot Bitcoin ETF Outflows On The Rise
The latest data from Farside Investors indicates that Grayscale’s GBTC fund has experienced a surge in outflows this week. On April 8 alone, the fund saw a significant withdrawal of $303.3 million. Moreover, it recorded net outflows of $154.9 million, $17.5 million, and $124.9 million on the following days, April 9 to 11.
After Michael Sonnensheig’s latest interview, where he expressed his view that GBTC is approaching a balance, there has been a noticeable increase in the number of investors withdrawing their funds from the trust. He indicated that most of the expected outflows have already occurred.
After switching to a Spot Bitcoin ETF, GBTC has seen over $15 billion in withdrawals, leading to a negative influence on Bitcoin’s price at various instances. Grayscale was forced to sell some of its Bitcoin holdings as a result of these redemptions, intensifying selling pressure on the leading cryptocurrency.
It’s noteworthy that Grayscale, more than any other Spot Bitcoin ETF provider, holds a considerable amount of Bitcoin (319,252 BTC). This is due to its early start as a closed-end fund prior to the approval of Spot Bitcoin ETFs on January 11.
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2024-04-12 15:41