Grayscale’s new Bitcoin ETF spin-off will function independently from the flagship fund, GBTC.
The crypto investment management company has launched a new product called the Grayscale Bitcoin Mini Trust, which has the ticker $BTC.
The new offering, endorsed as a spin-off of Grayscale’s Bitcoin exchange-traded fund (ETF) GBTC, has a competitive, “ultra-low” fee of 0.15%.
Grayscale’s New Spin-Off Fund
Months ago, Grayscale filed for the Mini Trust fund with the United States Securities and Exchange Commission (SEC). The firm describes this spin-off product as a new fund coined from an existing and possibly larger one. Following the creation, both funds will exist independently in the financial market. The difference is that the new product will potentially offer lower costs to attract more investors and increase their investment options.
The investment company explained in a blog post that current holders of Grayscale’s GBTC “will automatically receive one share of the spin-off fund for each share of the original fund.” Still, this will not alter the value of investors’ portfolios.
The Grayscale Bitcoin Mini Trust will be primarily traded on the securities exchange, NYSE Arca. Coinbase Custody Trust Company will be a digital asset custodian for the new ETF fund, while Foreside Fund Services will be the marketing agent.
Way Back Up?
Since launching as a spot Bitcoin ETF in January, Grayscale’s GBTC has recorded the most outflows year-to-date, as investors pull millions of dollars worth of BTC nearly every day. This steady outflow is partly attributed to the company’s expensive trading fee of 1.5%, the highest among Bitcoin ETF issuers in the country.
With its latest product, which has a trading fee of 0.15%, Grayscale is changing the narrative and positioning itself as the cheapest Bitcoin ETF issuer. In contrast, most financial firms offering the Bitcoin ETF product to U.S. investors implement a fee between 0.19% and 0.25%.
Although the market data in the coming weeks may say otherwise, Grayscale’s new ETF product may propel its position in the Bitcoin ETF market to new frontiers.