Fights over fees are nothing new in the booming $6.8 billion ETF industry, as each new fund seeks to gain market share by offering a lower price than the competition. Actively managed funds are able to charge slightly more than passive ETFs, with the average fee for active equity funds clocking in at 0.71%. BITO is actively managed, and the prospectus for XBTF indicates that it will be as well.
We were the first asset manager to file for a Bitcoin futures ETF, and we are offering what would be most competitively priced ETF when we come to market, said Ed Lopez, head of ETF product at VanEck.
The 30-basis-point difference in management fees should help the VanEck ETF attract demand, even after the ProShares funds record-shattering debut. More than 20 million shares of BITO traded Tuesday, ranking it as the second-busiest ETF launch ever.
Investors are looking for the cheapest way they can obtain exposure to Bitcoin, said Mohit Bajaj, director of ETFs at WallachBeth Capital. Especially if the instruments they are choosing between are correlated.
[More: First US Bitcoin-linked ETF raises concerns for advisers]
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