Grayscale Launches GBTC’s Spin-Off, Grayscale Mini Bitcoin Trust

Asset manager Grayscale launched a spin-off of its US-traded GBTC exchange-traded fund (ETF) on Wednesday after getting approval from the Securities and Exchange Commission (SEC) on July 26. The new fund is currently trading on the New York Stock Exchange (NYSE) with the ticker BTC.

Grayscale is excited to announce the launch of Grayscale Bitcoin Mini Trust, ticker: $BTC. BTC comes to market as a spin-off of our flagship fund $GBTC, and at the ultra-low cost of 0.15%. pic.twitter.com/nOrdAPCKTj

— Grayscale (@Grayscale) July 31, 2024

BTC would hold up to 10% of the spot Bitcoin held at GBTC, which is about $1.7 billion. Shareholders will still maintain the same amount of spot Bitcoin in their portfolio but will now have 90% of it in GBTC and 10% in the Gryacale Mini Bitcoin Trust.

Grayscale announced plans for the mini GBTC fund on July 19 after envisioning a similar product for its Grayscale Ethereum Trust. Notably, both Grayscale Ether ETFs (ETHE and ETH) went live on the first trading day and saw very different investor sentiments.

10x Lesser Fees

The new fund, BTC, offers a significant cost advantage with a discounted 0.15% management fee, ten times less than GBTC’s 1.5% annual charges. This positions BTC as the fund with the most competitive management fee, replacing Franklin Templeton’s EZBC.

A GBTC spin-off with a far lesser management fee could be the game-changer for the second-largest Bitcoin ETF issuer by asset under management (AUM). Grayscale’s GBTC has seen massive divestment from its spot Bitcoin product since its launch on January 11, with its lofty fees a probable factor.

This strategy has yielded a measure of result for Grayscale in its Ether ETF venture, with about $181 million of the over $1.8 billion that flowed out of ETHE going back to its ETH fund. Grayscale’s Mini Ethereum Fund has the fourth-largest inflow after six trading days, bettered only by BlackRock’s ETHA, Fidelity’s FETH, and Bitwise’s ETHW.

Grayscale’s GBTC saw its sixth consecutive outflow day after $73.6 million flowed out from the fund on Tuesday. Since its launch, GBTC has seen a net outflow of 18.94 billion, with an average outflow of $137.3 million daily.