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Grayscale Stabilizes GBTC Outflows, Plans Fee Reduction for Bitcoin ETF

CEO Michael Sonnenshein reveals Grayscale's GBTC outflows are stabilizing and announces a fee reduction for its Bitcoin ETF to stay ahead in the competitive market landscape.

  • Grayscale CEO indicates GBTC outflows may be stabilizing, with previous investor sales and bankruptcy selling largely behind.
  • Announces plans to reduce Grayscale's Bitcoin ETF fees, aiming to remain competitive as the market evolves and narrows to favor a few offerings.

World's leading crypto asset manager by assets under management (AUM), Grayscale has been in a lot of talks ever since the approval of the spot Bitcoin ETFs in the U.S. by the Securities and Exchange Commission (SEC).

Recently, Michael Sonnenshein, the CEO of Grayscale, told Reuters that the outflows from the Grayscale Bitcoin Trust (GBTC) might be stabilizing following months marked by investor sales.

“We do believe that the fund has started to reach a little bit of an equilibrium where some of those anticipated outflows, whether it was some of the bankruptcy selling, some investors perhaps undertaking switch trades, (are) largely behind us,” Sonnenshein said.

Additionally, Sonnenshein mentioned during an on-stage interview at Canaccord Genuity’s Digital Assets Symposium on April 10 that Grayscale's Bitcoin ETF will reduce its fees, currently the most expensive among all U.S. spot Bitcoin ETFs. 

He also said that markets often become very enthusiastic when a commodity or particular theme exposure product — like GBTC — launches and provides investors with initial access to assets. Further, Sonnenshein mentioned that as products develop and the market narrows, investors tend to invest significantly in just a handful of offerings over time.

“That means fees also come down over time. We’ll reduce fees on GBTC, and that also means that we’re kind of at the end of that first inning of that first wave of adoption,” said Sonnenshein. 

At present, Grayscale imposes a 1.5% fee on its converted ETF, which is significantly higher than the roughly 0.25% fee charged by many of its newer competitors, even before considering additional reductions from waivers.

Meanwhile, after postponing the application from Grayscale Investments to transform its Ethereum trust product (ETHE) into an ETF, the SEC has opened a 21-day comment window for the spot Ethereum ETF proposals by Grayscale Investments, Fidelity, and Bitwise.

Edited by Harshajit Sarmah