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As the chances for a bitcoin ETF appear to grow more likely, financial advisors and investors will need to dive into the details of the different proposed funds, including how much they cost. The Securities and Exchange Commission has long been opposed to an ETF that directly tracks the price of bitcoin, but a fund proposal from asset management giant BlackRock and a recent court ruling in favor of Grayscale suggest that could soon change. Many crypto and asset management industry professionals now expect the first so-called spot bitcoin funds to launch in 2024 . The number of firms jockeying for a spot bitcoin ETF has already broken into double digits, and it's still growing. Franklin Templeton jumped into the pool earlier this week. If the funds are eventually approved, a key variable for both these asset managers and investors is how high the management fees for the bitcoin ETFs will be. The current fund options for investors to bet on crypto are expensive. The Grayscale Bitcoin Trust (GBTC) has a 2% management fee. The largest bitcoin futures ETF, the ProShares Bitcoin Strategy ETF (BITO) , has an expense ratio of 0.95%. The biggest equity index funds, in contrast, can have expense ratios below 10 basis points, which is equal to 0.10%. The costs of equity funds have steadily fallen in recent decades as the ETF industry has matured and become more competitive. Steven McClurg, the chief investment officer at Valkyrie Investments, said he expects that the cost will be below the price of the futures funds because they should be cheaper to run for the asset managers. Valkyrie has a Bitcoin Strategy ETF (BTF) that holds futures and has also applied to launch a spot product. "I imagine 50 basis points is where it's going to shake out. We don't know yet, because we're still working on our own expenses and everyone else's too. But I think that's about where it is going to shake out," McClurg said. Similarly, Ric Edelman, founder of the Digital Assets Council of Financial Professionals, said in an August webinar that he expected the fees to fall between 50 and 100 basis points. Bryan Armour, director of passive strategies research for North America at Morningstar, said those estimates may prove to be too high. He pointed to a Roundhill Ether Futures ETF filing with a proposed 0.19% fee as a more realistic target. "I think that gives you a better indication of where you're going to see the most competitive fee," Armour said. If the funds are approved at roughly the same time, that would make it more difficult for one of the funds to gain a first-mover advantage and scale quickly, which could allow it to charge a premium, Armour said. "I'm guessing this will be effectively a commodity, sooner rather than later. Even if fees start off a bit higher, I don't think it will be long before they're compressed," Armour said. There could also be a situation where two groups of funds develop, with the larger firms that cater to institutional money pricing their funds below smaller firms that are focused on crypto and hope that their expertise in the area will win over investors despite a higher sticker price. BTC.CM= 3M mountain The Aug. 29 spike for bitcoin proved to be short-lived. "When I talk about the pools of competitors, the pool of BlackRock, Invesco, Fidelity will probably have lower fees, because they're going to be competing on a fee base with each other. The other pool of competitors, which will be like us and others, since we're going to be viewed more as experts, our fees will be a little bit higher, and people will pay for it," McClurg said. Correction: This article has been updated to reflect that Ric Edelman is founder of the Digital Assets Council of Financial Professionals. A previous version misspelled his name.

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A key question as a true bitcoin ETF gets closer to reality: How much ... - CNBC

Bitcoin (BTC) open interest outperformed the entire cryptocurrency market in August, amid hype relating to Bitcoin Spot Exchange-Traded Fund (ETF). The comparison follows a report by Bitfinex, noting that outflows reached $55 billion, with the liquidity crunch giving event-based volatility more influence on prices.

Also Read: Top 3 Price Prediction Bitcoin, Ethereum, Ripple: BTC grinds down despite surging open interest

A Bitfinex report indicates that Bitcoin open interest outperformed that of the entire cryptocurrency market, with the capital outflows in the crypto market hitting $55 billion in early August. This affected the price of Bitcoin and Ethereum, among other altcoins, with stablecoin liquidity dropping as crypto charts flashed red.

Based on the report, the last time such bearishness was indicated in the market was in November 2022, when Sam Bankman-Frieds FTX empire imploded.

Aggregate market realized value net position change

The capital outflow plunged the market into a liquidity crunch, as per the report, leaving Bitcoin price susceptible to event-based volatility. This means that isolated events could drive the market, evidenced by the August 17 incident that saw markets crash on speculation that Space X was selling its Bitcoin holdings.

It was also the time when Chinas second-most prominent real estate giant, Evergrande, filed for Chapter 15 Bankruptcy protection in New York. At the time, up to $820 million long positions were liquidated across the market.

Another event that drove the market wild was the August 29 victory for Grayscale in its longstanding case against the US Securities and Exchange Commission (SEC), giving a standing chance in court for its GBTC to ETF request.

Citing an excerpt from the report:

We believe that while volatility metrics continue to be low, the liquidity crunch in the market has allowed isolated events to have a bigger impact on market movements.

Bitcoin price remained bearish for most part of August amid surging open interest and subsequent increases in liquidations. Ethereum price recorded a similar market outlook, causing investors to wonder whether it was the work of manipulators.

As it stands, the trend continues to prevail, with Bitcoin price still moving within a small range; volatility remains low. This has investors exercising excessive caution even as the market craves for impulse.

Liquid supply corresponds to short-term holders who are at the forefront of market movements, actively responding to price fluctuations. In the same way, illiquid supply reserves correspond to the long-term custodians (holders).

The stance of these stakeholders towards Bitcoin is one of unwavering allegiance, with their strategy being to gradually accumulate during times of market downturns and take partial profits or none at all during market tops.

The August 17 crash and August 29 Greyscale victory remain evidence that event-based volatility has returned to crypto. While volatility metrics continue to be low, the liquidity crunch in the market has allowed isolated events to have a bigger impact on market movements.

An Exchange-Traded Fund (ETF) is an investment vehicle or an index that tracks the price of an underlying asset. ETFs can not only track a single asset, but a group of assets and sectors. For example, a Bitcoin ETF tracks Bitcoins price. ETF is a tool used by investors to gain exposure to a certain asset.

Yes. The first Bitcoin futures ETF in the US was approved by the US Securities & Exchange Commission in October 2021. A total of seven Bitcoin futures ETFs have been approved, with more than 20 still waiting for the regulators permission. The SEC says that the cryptocurrency industry is new and subject to manipulation, which is why it has been delaying crypto-related futures ETFs for the last few years.

Bitcoin spot ETF has been approved outside the US, but the SEC is yet to approve one in the country. After BlackRock filed for a Bitcoin spot ETF on June 15, the interest surrounding crypto ETFs has been renewed. Grayscale whose application for a Bitcoin spot ETF was initially rejected by the SEC got a victory in court, forcing the US regulator to review its proposal again. The SECs loss in this lawsuit has fueled hopes that a Bitcoin spot ETF might be approved by the end of the year.

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Bitcoin open interest outperformed crypto markets amid BTC Spot ETF hype - FXStreet

Bitcoin (BTC) posted another green candlestick on Thursday, with the BTC/USDT pair closing above $26,500, or up around 1.15% on the previous days closing price.

It brought the worlds largest cryptocurrency to its highest price point this month, lifting hopes that the September (or Septembear) curse may not chip away at bitcoins strong year-to-date performance after all.

Bitcoin remained buoyant this morning, with a quarter percentage point bump bringing it to $26,568 at the time of writing.

Bulls will be looking toward $27,000 at the next target, though Binances order book shows a strong sell wall here, which could make it difficult to break through resistance.

BTC/USDT is around 1.5% lower over six months Source: tradingview.com

On the support side, Binances order book shows solid buy-side orders at the flat US$26,000 price point.

Bitcoin appears unphased by hotter-than-expected inflation data emerging from the US this week.

On Wednesday, the consumer price index posted its biggest monthly gain of the year by rising 0.6% in August, while the year-on-year inflation rate as a whole overshot market forecasts by 0.1 percentage points.

In wider cryptocurrency news, Genesis, once one of the largest crypto trading desks in the business, has officially ceased any and all trading services, whether spot or derivates products, through all of its international business entities.

Earlier this month, Genesis announced that its US operations were closing, though the Digital Currency Group-owned firm has evidently decided to close shop entirely.

Genesis has decided to stop offering digital asset spot and derivatives trading through GGC International, Ltd. (GGCI), read an email statement. This decision was made voluntarily and for business reasons. With this termination of services from GGCI, Genesis no longer offers trading services through any of its business entities.

Genesis blamed the 2022 collapse of crypto-focused hedge find Three Arrows Capital, and subsequent market turmoil, on its decision to fold.

Back to the markets, Ethereum (ETH) added 1.2% on Thursday to bring its spot price to $1,626 against the US dollar.

The ETH/USDT pair stayed essentially flat this morning, having knocked slightly higher to $1,628.

Week on week, bitcoin remains 1.2% higher while ether is around 1.1% lower, thus increasing bitcoin dominance a measure of its market cap against the entire crypto markets back above 50%.

In the wider altcoin space, BNB, Ripple (XRP), Cardano (ADA) and Dogecoin (DOGE) are down in the low single digits week on week.

Tron (TRX) and Toncoin (TON) remain the outperformers among the top-20 set, adding 5.9% and 7.5% respectively.

Global cryptocurrency market cap currently stands at $1.05 trillion, having added a little over 1% overnight.

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Bitcoin remains buoyant as crypto trader Genesis closes shop - Proactive Investors USA