<\/p>\n
The proposed management fee of a planned ether futures ETF could signal a crypto fund fee war is brewing, according to market observers.<\/p>\n
But how that could impact the cost of a spot bitcoin ETF<\/a> \u2014 and whether investors even care \u2014 remains to be seen, particularly as the Securities and Exchange Commission has never permitted such a product to launch.\u00a0<\/p>\n Roundhill Investments revealed in an Aug. 4 filing<\/a> that its Ether Strategy ETF would charge a management fee of 19 basis points, or 0.19%.<\/p>\n The 0.19% fee is nearly one-sixth the fee that Volatility Shares plans to charge for its Ether Strategy ETF, a planned fund that kicked off a slew of similar filings. These proposed fees could change between now and potential approval of the product.\u00a0\u00a0<\/p>\n Read more:<\/strong> SEC now ready to consider ETH futures ETFs, sources say \u2014 but what\u2019s changed?<\/a><\/p>\n The management fees represent a portion of the expense ratio, or the percentage of the fund\u2019s assets that is used to cover various expenses of running the fund.\u00a0<\/p>\n A Volatility Shares spokesperson declined to comment. Roundhill did not return a request for comment.\u00a0\u00a0<\/p>\n Bloomberg Intelligence analysts Eric Balchunas and James Seyffart highlighted the Roundhill fee in tweets<\/a> last week.<\/p>\n \u201cFee wars already starting and we [are] two months from launch,\u201d Balchunas said. \u201cETF Terrordome in effect.\u201d<\/p>\n The proposed spot bitcoin ETFs being reviewed by the SEC<\/a> have not yet revealed their expense ratios.<\/p>\n Matt Hougan, chief investment officer of prospective spot bitcoin ETF issuer Bitwise, said during a webinar earlier this month that the expense ratios of futures-based ETFs could signal what spot bitcoin ETF issuers might charge.<\/p>\n The ProShares Bitcoin Strategy ETF (BITO) \u2014 the largest bitcoin futures ETF, and first to launch \u2014 has an expense ratio of 0.95%. So, too, does the Valkyrie Bitcoin Strategy ETF (BTF). VanEck\u2019s bitcoin futures fund (XBTF) is cheaper, carrying an expense ratio of 0.66%.<\/p>\n Ric Edelman, founder of the Digital Assets Council of Financial Professionals (DACFP), said during the webinar with Hougan that he expects spot bitcoin ETFs to carry expense ratios between 0.5% and 1.0%.<\/p>\n But Nate Geraci, president of The ETF Store, said in an Aug. 18 tweet<\/a> that issuers of spot bitcoin ETFs may look to beat Roundhill\u2019s proposed 0.19% fee.<\/p>\n \u201cThought we could see [less than] 40 [basis points]; It might end up way lower than that,\u201d Geraci added. \u201cWill be brutal fee competition.\u201d<\/p>\n Dave Nadig, financial futurist at VettaFi, said 0.19% would be cheap for an ETF focused on any kind of alternative asset class.\u00a0<\/p>\n Issuers of a crypto futures product could charge more than those of spot-based products, Nadig argued, noting the roll costs associated with futures contracts.<\/p>\n \u201cHowever, because a spot bitcoin [ETF] is going to be largely an access vehicle, I suspect volume is going to be vastly more important than expense ratio,\u201d he told Blockworks.\u00a0<\/p>\n Expense ratio likely won\u2019t matter at all if the SEC greenlights one spot bitcoin ETF to launch by itself, Nadig said \u2014 a scenario opposed by Grayscale Investments<\/a> and VanEck\u2019s head of digital assets research<\/a>.\u00a0<\/p>\n But if multiple launch at once, expense ratio, as well as fund volumes \u2014 likely driven by institutions \u2014 will be more critical for the ETFs\u2019 success, he added.<\/p>\n \u201cYou can imagine a scenario where there\u2019s a known start date and various players then go and quietly nudge their largest ETF [and] crypto-interested trading partners and clients,\u201d Nadig said. \u201cIn that case, volume will matter, but [expense ratio] might.\u201d<\/p>\n Get the day\u2019s top crypto news and insights delivered to your email every evening.\u00a0Subscribe to Blockworks\u2019 free newsletter<\/a>\u00a0now.<\/strong><\/p>\n Want alpha sent directly to your inbox? Get degen trade ideas, governance updates, token performance, can\u2019t-miss tweets and more from\u00a0Blockworks Research\u2019s Daily Debrief<\/a>.<\/strong><\/p>\n Can\u2019t wait? Get our news the fastest way possible.\u00a0Join us on Telegram<\/a>\u00a0and follow us on\u00a0Google News<\/a>.<\/strong><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":" The proposed management fee of a planned ether futures ETF could signal a crypto fund fee war is brewing, according to market observers. But how that could impact the cost of a spot bitcoin ETF \u2014 and whether investors even care \u2014 remains to be seen, particularly as the Securities and Exchange Commission has never […]<\/p>\n","protected":false},"author":2,"featured_media":141463,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[230,225,221,227,226,228,229,60,223,224,222],"class_list":["post-141462","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-cryptocurrency","tag-brave","tag-coinbase","tag-crypto","tag-decentralised","tag-decentralized","tag-decentralized-exchange","tag-erc-20","tag-featured","tag-meme-coin","tag-robinhood","tag-solana"],"_links":{"self":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts\/141462","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/comments?post=141462"}],"version-history":[{"count":2,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts\/141462\/revisions"}],"predecessor-version":[{"id":146950,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts\/141462\/revisions\/146950"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/media\/141463"}],"wp:attachment":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/media?parent=141462"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/categories?post=141462"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/tags?post=141462"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}How this could relate to bitcoin ETFs<\/h2>\n
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