- BlackRock’s Bitcoin ETF (IBIT) has $18.1 billion in assets under management (AUM), just $3.8 billion less than Grayscale’s Bitcoin Trust (GBTC) with $21.9 billion AUM.
- IBIT has low fees of 0.12% for the first year and 0.25% after that, while GBTC charges 1.5%, causing investors to move to cheaper products like IBIT.
- Grayscale CEO Michael Sonnenshein said the outflows from GBTC are approaching “equilibrium” as the fund redeems shares from failed crypto companies.
BlackRock’s new Bitcoin exchange-traded fund (ETF) is quickly gaining ground on Grayscale’s GBTC in terms of assets under management. The gap between the two funds now stands at just under $4 billion and could flip as early as this month.
IBIT’s Rapid Growth
The BlackRock iShares Bitcoin Trust (IBIT) currently has $18.1 billion in assets under management. Meanwhile, the Grayscale Bitcoin Trust (GBTC) has $21.9 billion under management.
Last week, the difference was $6 billion, showing how rapidly IBIT is catching up. Since launching in January after SEC approval, the BlackRock ETF has proven hugely popular. As the world’s largest asset manager, BlackRock brings prestige and trust to the new Bitcoin product. The ETF also has low fees starting at 0.12% for the first year.
Outflows from GBTC
While GBTC has name recognition in crypto, its high fees of 1.5% are prompting investors to switch to cheaper alternatives like IBIT. GBTC is also seeing shares redeemed rapidly as failed crypto firms with GBTC exposure claw back assets for clients amid bankruptcy.
Hundreds of millions have flowed out of GBTC recently. However, Grayscale’s CEO said this week that outflows are nearing an “equilibrium” point.
Closing the Gap
Given the current pace, experts predict IBIT could overtake GBTC within weeks, if not days. The cheaper, BlackRock-backed ETF offers traditional finance credibility and is siphoning assets away from GBTC. If flows continue, the long-time crypto fund GBTC may soon be dethroned as the top Bitcoin investment fund.
