Fidelity, a well-known asset management, has announced a fee cut for its Bitcoin Exchange-Traded Product (ETP) in Europe, following a trend among cryptocurrency issuers to lower costs as market competition heats up. The Fidelity Physical Bitcoin ETP (FBTC) will see its total expense ratio (TER) reduced from 0.75% to 0.35%, making it more competitive in the market.
Market dynamics
Eric Balchunas, Senior ETF Analyst at Bloomberg, shared the news on X, emphasising the significance of Europe’s fee cut from 75 basis points (bps) to 35 bps.
Fidelity’s pricing cut follows similar fee reductions by other cryptocurrency issuers in Europe, including Invesco, WisdomTree, and CoinShares. These reductions followed the debut of 11 spot Bitcoin ETFs in the United States, which sparked a pricing war among asset managers in Europe as they sought to capitalise on rising institutional demand for crypto products.
https://x.com/EricBalchunas/status/1757748245286052016?s=20
Speaking on the impact of the recent approval of spot Bitcoin ETFs in the United States on global investor interest in cryptocurrencies, Christian Staub, Managing Director Europe at Fidelity, stated, “We have had numerous conversations with clients over the past months as they are rightly asking for an efficient way to benefit from this trend.”
Implications of fee reductions for crypto market
Fidelity’s fee cut intends to meet this increased demand by giving more investors access to the Bitcoin asset class via its ETP. As competition heats up and investors seek low-cost investing choices, ETF providers under pressure to reduce costs in order to remain competitive.
With this price cut, FBTC is getting closer to being one of Europe’s cheapest physical Bitcoin ETPs, matching competitors like WisdomTree and CoinShares, which have also reduced their costs to 0.35%. It also illustrates Fidelity’s commitment to meeting the changing demands of investors while maximising value for its clients.
