Grayscale’s Outflows Could Be Approaching Zero. Here’s Why
According to Bitcoin analyst Alessandro Ottaviani, the outflows from Grayscale’s struggling GBTC may soon come to a halt. This is because Grayscale’s Bitcoin Mini Trust is expected to offer fees as low as 0.15%.
However, Bloomberg’s senior ETF analyst Eric Balchunas has warned that these low fees are still hypothetical and may not be sustainable. Nonetheless, Balchunas sees this as a positive development considering Grayscale had to choose a percentage for the fees.
Grayscale had announced its plans to launch a smaller fund back in March, with the aim of allowing existing GBTC holders to purchase ETF shares without incurring taxable events. This spinoff fund will be launched under the BTC ticker.
Meanwhile, BlackRock’s IBIT is predicted to surpass Grayscale’s GBTC in terms of total assets under management by the end of this month. With over $17 billion in AUM, IBIT is already one of the largest ETFs in the market, outpacing giants like iShares MSCI Emerging Markets ETF (EEM) and iShares MSCI Japan ETF (EWJ).
The significant outflows from Grayscale’s GBTC have been a major challenge for the company. Grayscale CEO Michale Sonnenshein previously anticipated a reduction in Bitcoin fees. Currently, GBTC has the highest fees among Bitcoin ETF issuers at 1.5%, making it unable to compete with industry leaders like BlackRock and Fidelity. In comparison, Bitwise offers a record-low fee of just 0.2%.