ARK Invest reveals ultra-low fees for Bitcoin ETF, potentially sparking price war in the future

According to the Financial Times, Cathie Wood's Ark Invest is the first to explicitly outline the proposed expenses for a Bitcoin ETF. Analysts suggest that the ETF will pay a 95 basis point handling fee to the issuer 21 Shares for operational costs, and the ETF's fee rate may be equivalent to the handling fee, potentially coming very close to 0.95%.

According to a report by the Financial Times, Cathie Wood's ARK Invest is the first to explicitly disclose the proposed expenses for a Bitcoin ETF. Analysts state that this ETF will pay a handling fee of 95 basis points to the issuer 21 Shares as operational expenses, and the ETF's fee rate may be equivalent to the handling fee, which could be very close to 0.95%.

ARK Invest submitted an application to the U.S. Securities and Exchange Commission (SEC) at the end of June to jointly launch the "ARK 21SHARES BITCOIN ETF" with ETP issuer 21Shares.

Neena Mishra, Director of ETF Research at investment research firm Zacks, mentioned that due to the significant market presence of ARK Invest's ETF, it may prompt other institutions to follow suit in setting fee rates or even engage in price competition, potentially triggering a price war, similar to the bottom pricing competition seen with Canadian Bitcoin ETFs.

Neena Mishra stated that if ARK Invest's Bitcoin ETF is approved, investors in ARK's flagship ARKK Innovation ETF with assets over $24 billion and the ARKW Next Generation Internet ETF with assets over $6 billion will become major shareholders. This means investors in the Innovation ETF and Next Generation Internet ETF will gain exposure to the Bitcoin ETF at no additional cost, further piquing investor interest.

Based on Arktrack data, ARKK and ARKW both hold shares of Coinbase at 3.55% and 3.4%, respectively. Additionally, ARKW also invests in Grayscale's GBTC at 4.05%. ARK has chosen Coinbase as the custodian for its Bitcoin ETF.

Mishra predicts that in the U.S., the first Bitcoin ETF launched may capture the majority of new flows, and if all Bitcoin ETFs launch on the same day, the cheapest one will likely be the most popular.

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