XBTF Dips Amidst Market Turbulence, 3rd Bitcoin Futures ETF Launches with Lowest Fee But Fails to Gain Traction
VanEck’s Bitcoin Futures ETF (XBTF) only amassed $9.6 million in AUM compared to ProShares’ (BITO) over $1 billion and Valkyrie’s (BTF) $60 million.
A third Bitcoin Futures exchange-traded fund (ETF) has entered the US market.
The VanEck Bitcoin Target ETF (XBTF) launched on Tuesday, about a month after ProShare’s Bitcoin ETF (BITO) became the first to debut in the US.
BITO’s launch saw record-setting demand by amassing $1.1 billion in just two days, the fastest an ETF has ever done so. However, since then, the pace of its growth has cooled off as its assets remained between $1.3 billion and $1.4 billion in the past several weeks.
Three days after BITO’s launch, Valkyrie’s Bitcoin Futures ETF (BTF) also made its debut and has accumulated just $60 million.
Now, VanEck’s Bitcoin Fund has been launched at a time when the market is experiencing some volatility, with Bitcoin down 12.3% from its all-time high of $69,000 a week back. On Tuesday, Bitcoin’s price fell as low as $58,570 but is currently above $60k.
Since mid-October, Bitcoin has slipped 5.7% while the BITO shares slumped even more by 7.7% because the fund must continually roll forward its future exposure as the contracts aspire and pays a fee to do so.
On its first day, XBTF saw 38,398 shares trading, ending the day at $59.73 per share, a bit below its opening price of $60 per share.
According to VanEck, the ETF has $9.6 million assets under management. While “normally that would be pretty good,” its launch is shadowed by the massive demand seen by BITO at $1 billion on its opening day and even BTF, which did $78 million, said Eric Balchunas, a senior ETF analyst for Bloomberg.
However, the new VanEck ETF carries a lower fee at 0.65% than the other two funds, both of which have a 0.95% fee, which can help its demand.
“It has its work cut out for it. Low fee will help but not in near term. I do see it being successful, but it will take some time,” Balchunas said.
Last week, the SEC rejected VanEck’s attempt to launch a spot Bitcoin ETF, which is seen as superior to Futures ETF as it will directly invest in the cryptocurrency.