Fidelity Investments and Galaxy & Invesco, the issuers of two proposed Bitcoin exchange-traded funds (ETFs), have set the fees they will charge if their ETFs are approved.
Fidelity Investments and Galaxy & Invesco, the issuers of two proposed Bitcoin exchange-traded funds (ETFs), have set the fees they will charge if their ETFs are approved.
According to a report from Fortune, Fidelity will charge 0.39% per year to holders of its Wise Origin Bitcoin Trust, while Galaxy/Invesco will charge 0.59% per year for its BTCO fund. In Galaxy/Invesco's case, the fee will be waived for the first six months of the fund's operation. According to a Dec. 29 court filing, it also revealed that Jane Street Capital will be the "authorized participant" for the Bitcoin ETFs of Fidelity, WisdomTree, and Valkyrie. This means that Jane Street Capital will be allowed to arbitrage differences in price between these funds' shares and Bitcoin itself.
Valkyrie also named Cantor Fitzgerald as a second authorized participant. Galaxy/Invesco and BlackRock have named both JPMorgan as their authorized participants.
The ETFs will use a "cash" model for creation and redemption, which means that authorized participants will not purchase Bitcoin and deposit it into the funds. Instead, they will deposit the cash equivalent for the amount of Bitcoin they want to deposit, which will then be used by the fund to purchase BTC. The United States Securities and Exchange Commission (SEC) has pushed for this solution, claiming that it doesn't want to allow broker-dealers to handle Bitcoin, the report states.
Crypto and Bitcoin investors have been eagerly awaiting the approval of the first-ever spot Bitcoin ETF in the United States, with the decision expected to be in before the January 10 deadline.
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