The cryptocurrency and fund management industries witnessed a watershed moment on Jan. 10, marking a significant milestone with the U.S. Securities and Exchange Commission’s approval of 11 new spot Bitcoin (BTC) ETFs.
This development signifies a major shift from the previous norm where exchange-traded funds were limited to holding Bitcoin futures. These newly approved Bitcoin ETFs are physically backed by Bitcoin held with a custodian, which offers substantial benefits including lower tracking error and a more direct exposure to the cryptocurrency’s price movements.
This breakthrough follows a tumultuous yet pivotal year in 2023, characterized by a renewed Bitcoin bull run and a landmark legal victory by Grayscale Investments. Following these developments, various ETF providers were quick to amend their prospectuses, positioning themselves at the forefront of this new investment opportunity.
The days leading up to the SEC’s approval were filled with tension, notably marked by the compromise of the SEC’s Twitter (now X) account. A false approval was prematurely tweeted on Jan. 9, adding to the suspense and anticipation within the investment community prior to the debut of these ETFs.
The aftermath of the official approval on Jan. 11 was nothing short of dramatic, with U.S. Bitcoin ETFs experiencing a trading volume surge to $4.6 billion. Bitcoin itself reached a peak of $48,922 during the trading frenzy, reflecting the market’s enthusiastic response to this historic decision. Within days, it would be trading below $42,000 once more.
Here’s a comprehensive list of all the new Bitcoin ETFs approved by the SEC that are available for trading:
| ETF | Current Expense Ratio | Fee waiver? |
| Grayscale Bitcoin Trust ETF (ticker: GBTC) | 1.5% | No |
| Hashdex Bitcoin Futures ETF (DEFI) | 0.9% | No |
| Franklin Bitcoin ETF (EZBC) | 0% | Yes. Through Aug. 2 for first $10 billion in AUM, then 0.19% |
| VanEck Bitcoin Trust (HODL) | 0.25% | No |
| iShares Bitcoin Trust (IBIT) | 0.12% | Yes. 12-month waiver for first $5 billion in AUM, then 0.25% |
| Valkyrie Bitcoin Fund (BRRR) | 0% | Yes. Goes to 0.25% after three months |
| Invesco Galaxy Bitcoin ETF (BTCO) | 0% | Yes. Six-month waiver for first $5 billion in AUM, then 0.39% |
| WisdomTree Bitcoin Fund (BTCW) | 0% | Yes. Six-month waiver for first $1 billion in AUM, then 0.3% |
| Fidelity Wise Origin Bitcoin Fund (FBTC) | 0% | Yes. Goes to 0.25% on Aug. 1 |
| Ark 21Shares Bitcoin ETF (ARKB) | 0% | Yes. After six months or $1 billion in AUM, goes to 0.21% |
| Bitwise Bitcoin ETF (BITB) | 0% | Yes. Six-month waiver on first $1 billion in AUM, then 0.2% |
Grayscale Bitcoin Trust ETF (GBTC)
Formerly a closed-ended trust, the reigning king GBTC has now been converted into an open-ended ETF. Its history dates back to 2013 as the world’s first publicly traded Bitcoin fund. Currently, it remains the largest Bitcoin ETF with more than $25 billion in assets under management, or AUM, as of Jan. 17.
However, the ETF’s dominance may be waning slightly. In the opening days of the various Bitcoin ETF launches, GBTC saw some net outflows as investors flocked to the newer, less expensive ETFs. This was largely due to GBTC’s continued high expense ratio, which currently sits at 1.5%.
Hashdex Bitcoin Futures ETF (DEFI)
DEFI started out a Bitcoin futures ETF, but changes are underway. On Jan. 11, the firm announced a change to the ETF’s investment strategy that would allow it to hold spot Bitcoin. The firm anticipates that the ETF’s name and strategy will be later changed formally to reflect this modification.
The main selling point for DEFI is the prospect of investing alongside a firm with dedicated cryptocurrency industry experience. Hashdex is responsible for creations like the Nasdaq Crypto Index, which provides a benchmark for industry enthusiasts. DEFI charges a 0.9% expense ratio.
Franklin Bitcoin ETF (EZBC)
Known for its extensive lineup of international equity funds, Franklin Templeton has also thrown its hat into the Bitcoin ETF space with EZBC. This ETF tracks spot Bitcoin held with a trusted custodian, which in this case is Coinbase Global Inc. (COIN).
EZBC is traded on the Chicago Board Options Exchange (CBOE) and has so far has attracted around $49 million in AUM, representing 1,160 Bitcoin as of Jan. 17. The ETF is currently waiving fees to zero through Aug. 2 for the first $10 billion of AUM.
VanEck Bitcoin Trust (HODL)
HODL’s ticker name is a humorous reference to the cryptocurrency pop culture motto of “hold on for dear life.” Many cryptocurrency investors use “HODL” to describe an unwillingness to sell their Bitcoin even during periods of high volatility or a prolonged “crypto winter,” when prices are in the doldrums.
The ETF itself has accumulated about $86 million in AUM through Jan. 17, with an expense ratio of 0.25%. Like DEFI, it is also traded on the CBOE. For those seeking even higher exposure, VanEck anticipates HODL will have an options chain, but this is currently unavailable.
iShares Bitcoin Trust (IBIT)
BlackRock Inc. (BLK), one of the world’s largest asset managers, also took part in the Bitcoin ETF race with IBIT, which debuted on the Nasdaq exchange. This ETF initially charged a 0.25% expense ratio, but BlackRock has since waived that by half to 0.12% for the first $5 billion of AUM over a 12-month period.
So far, IBIT has been quite successful, reportedly cracking the $1 billion AUM figure on Jan. 18, less than a week after its debut. BlackRock has also done a fairly good job of keeping this ETF liquid, with a median bid-ask spread of 0.04% as of Jan. 18.
Valkyrie Bitcoin Fund (BRRR)
As with HODL, BRRR’s ticker may also be a humorous reference to the sound of money being printed. The ETF trades on the Nasdaq exchange alongside IBIT, and is currently waiving its regular 0.25% expense ratio to zero for the first three months in an effort to attract investors.
As with EZBC, BRRR’s underlying Bitcoin will be held with Coinbase as its custodian. So far, the ETF has attracted more than $62 million in net assets, corresponding to around 1,485 Bitcoin at the time of this writing. The benchmark index for this ETF is the CME CF Bitcoin Reference Rate – New York Variant.
[Read: The History of Bitcoin, the First Cryptocurrency]
Invesco Galaxy Bitcoin ETF (BTCO)
Invesco Ltd. (IVZ) has also expanded into the Bitcoin ETF space. The firm’s offering here is BTCO, which currently has about $137 million in AUM as of Jan. 17. As with some of the previous ETFs, Invesco is waiving fees from 0.39% to zero for a six-month period on the first $5 billion in AUM.
“In addition to offering a simpler, more familiar access point to Bitcoin, BTCO brings together the unparalleled expertise of a veteran ETF provider like Invesco and an established crypto native like Galaxy,” says Kathy Kriskey, senior ETF strategist at Invesco.
WisdomTree Bitcoin Fund (BTCW)
Despite being known more for its lineup of fundamentally weighted dividend funds, WisdomTree hasn’t shied away from entering the Bitcoin ETF competition. Going up against industry heavyweights like BlackRock and Grayscale, the firm launched BTCW as its spot Bitcoin ETF offering.
To attract inflows, BTCW has also implemented a fee waiver. For a six-month period commencing Jan. 11, the ETF is waiving its 0.3% expense ratio to zero for the first $1 billion in AUM. However, the ETF is still off to a fairly slow start with just $3.1 million in AUM accumulated through Jan. 17.
Fidelity Wise Origin Bitcoin Fund (FBTC)
FBTC isn’t actually Fidelity’s first spot Bitcoin ETF. On Nov. 30, 2021, the firm launched the Fidelity Advantage Bitcoin ETF (FBTC) in Canada. This was possible as the Canadian securities regulator permitted the debut of spot Bitcoin ETFs far earlier than the SEC did.
With the SEC decision in the books, Fidelity is now free to levy its substantial presence and marketing resources to ensure the U.S. version of FBTC becomes a success. This includes wading into the ongoing fee war with a waiver as well, reducing FBTC’s expense ratio from 0.25% to zero. On Aug. 1, the 0.25% fee is slated to return.
Ark 21Shares Bitcoin ETF (ARKB)
Ark Invest and its star manager, Cathie Wood, have been no strangers to headlines in recent years. Wood regularly has her fund’s trades covered in media, such as a recent purchase of Tesla Inc. (TSLA) by the Ark Innovation ETF (ARKK) and the Ark Next Generation Internet ETF (ARKW).
Thanks to a partnership with 21Shares, Ark Invest now offers Bitcoin exposure as well through ARKB. Listed on the CBOE, ARKB has managed to attract just $10.3 million in inflows through Jan. 10, making it a bit of a laggard in the race. Like the other ETFs, it is also temporarily waiving its expense ratio. Once it attracts $1 billion in AUM, or when six months have passed, whichever comes sooner, it will charge a 0.21% expense ratio.
Bitwise Bitcoin ETF (BITB)
Bitwise is one of the few firms to list its Bitcoin ETF on the New York Stock Exchange, or NYSE. This dedicated cryptocurrency asset manager debuted BITB and has achieved strong success in the opening days of the Bitcoin ETF race with $354 million in AUM through Jan. 17.
Like many of the previous ETFs, Bitwise is currently waiving BITB’s expense ratio to zero for a six-month period on the first $1 billion in AUM. But even without the waiver, BITB’s expense ratio is very competitive at just 0.2%, making it one of the cheapest options on this list.
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11 New Spot Bitcoin ETFs to Buy in 2024 originally appeared on usnews.com
