Invesco and Galaxy Cut Spot Bitcoin ETF Fees in Cutthroat Market

Katie Greifeld and Emily Graffeo, Bloomberg News

(Bloomberg) -- Invesco and Galaxy Asset Management just fired the latest volley in the spot Bitcoin ETF fee war amid a crowded field.

The two firms announced Monday that the Invesco Galaxy Bitcoin ETF (ticker BTCO) will charge an eventual expense ratio 0.25%, down from 0.39% previously, according to a statement. The fund’s fees are waived for the first six months or until it reaches $5 billion in assets.

It’s the latest move in the nascent industry’s already-established fee war, with issuers lowering their costs even before US regulators allowed the spot Bitcoin ETFs to launch earlier this month. Sector heavyweights BlackRock Inc. and Fidelity — with their distribution muscle — have broken away from the pack, with combined investor inflows of roughly $4 billion, or roughly 70% of total spot Bitcoin ETF inflows. Meanwhile, BTCO is in fifth place so far with an about $283 million haul.

Even with Monday’s fee cut, BTCO still isn’t the cheapest spot Bitcoin ETF on the market. Franklin Templeton’s fund has a post-waiver 0.19% expense ratio — the lowest among spot-Bitcoin ETFs.

Shares of BTCO rose 2.8% on Monday, mirroring a similar increase in the price of Bitcoin.

(Updates the share price in the final paragraph. An earlier update corrected the third paragraph to say billion instead of trillion.)