Bitwise, the asset manager, has introduced a 0.20% fee in its revised application for a US-based Solana ETF that now incorporates staking features. This move could indicate rising competition among ETF issuers, as suggested by ETF analyst Eric Balchunas.
“We expected to see higher fees initially; a competitive environment is necessary to drive them this low,” Balchunas commented in an X post on Wednesday. “They probably anticipated it would settle there eventually, so they decided to act now,” he remarked, describing it as a “veteran Terrordome move.”
On Wednesday, Bitwise revised its submission to the US Securities and Exchange Commission, updating the proposed Solana (SOL) ETF to feature an annual management fee of 0.20% along with the staking addition. This fee is situated within the typical range for crypto ETFs, which usually lie between 0.15% and 0.25%.
“Lower fees tend to pull in investors effectively, indicating a promising potential for inflows,” Balchunas elaborated.
Speculation on Crypto ETF Fees
Leading up to potential crypto ETF launches, market participants have often scrutinized which issuers would present the lowest fees.
The competition particularly intensified before the US launch of spot Bitcoin (BTC) ETFs in January 2024; asset manager VanEck waived all fees initially and extended this waiver through January 2026 for up to $2.5 billion in assets. Meanwhile, Grayscale Bitcoin Mini Trust (BTC) established a sponsor fee of 0.15% per annum.
On July 2, the REX-Osprey Solana Staking ETF (SSK), the first Solana staking ETF in the US, finished its inaugural trading day with inflows of $12 million, carrying an annual management fee of 0.75%.
BlackRock’s Position on the Solana ETF
However, Balchunas noted that Bitwise’s proposed product is less expensive, offers superior tracking, and is fully backed by actual Solana assets. “SSK is fraught with tracking issues similar to those of a futures ETF, trailing spot Solana by 12%, although there has been improvement recently,” he stated.
Related: US Bitcoin ETFs post 2nd-highest inflows since launch on crypto rally
Crypto commentator “Magoo PhD” raised a question that has been on many minds recently: why hasn’t BlackRock, the world’s largest asset manager, filed for a SOL ETF?
ETF analyst James Seyffart recently remarked that it would be “unfair” if BlackRock submitted a last-minute application to launch its ETF alongside others that had already done significant groundwork with the SEC.
On September 26, ETF analyst Nate Geraci predicted that multiple applications for Solana ETFs with staking could obtain US approval by mid-October.
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