Billions flood into bitcoin ETFs amid price surge – just not Grayscale’s

investmentnews.com:

Investor have poured at least $10 billion into spot-price bitcoin ETFs since the SEC approved the products in January, corresponding with a rapid increase in the crypto asset’s price to an all-time high.

But not all of the ETFs that were first to market have benefited from the frenzied demand that has pushed the cryptocurrency’s price above $69,000. The biggest such product, the $27.5 billion Grayscale Bitcoin Trust, ETF has been like a sieve – bleeding nearly $10 billion. That product had a massive head start on its competitors in terms of assets, given that Grayscale converted its bitcoin trust to an ETF. But the ETF sponsor also charges the highest fees among the competitors, at 1.5 percent.

“I don’t know if they were anticipating a lot of capital gains in their investor base – so perhaps they expected folks to be unable to move out,” said Bryan Armour, director of passive strategies research for North America at Morningstar Research Services. “But they have been hemorrhaging cash.”

As of March 6, Grayscale’s ETF had seen $9.9 billion in net redemptions since its conversion, Armour said, citing data from Morningstar Direct. Just over the past five days, more than $2 billion has poured out, he said.

BlackRock and Fidelity have benefited. Their products, the iShares Bitcoin Trust Registered ETF and Fidelity Wise Origin Bitcoin Fund, started from scratch and have reached $12.6 billion and $7.8 billion in assets, respectively, as of Friday, according to data from VettaFi. The next biggest competitor, the Ark 21Shares Bitcoin ETF, represented $2.5 billion, followed by the Bitwise Bitcoin ETF Trust, at $1.8 billion.

The iShares ETF, the obvious winner in sales, became the ETF that reached the $10 billion mark most quickly,