Bitwise Bitcoin ETF (BITB) has revealed the on-chain addresses of its holdings. This is the first issuer of 11 funds approved.
This important decision enables public verification of BITB’s holdings and blockchain flows.
Bitwise’s move is consistent with the core ethos of Bitcoin (BTC), which emphasizes transparency and public verification. Bitwise has also expressed ambitions to expand these efforts. Collaborations with companies like Hoseki are coming soon, with the goal of providing real-time cryptographic proofs.
BITB provides a new level of transparency by revealing the Bitcoin addresses of your holdings. Investors can now check their ETF holdings directly on the blockchain, ensuring accuracy and security.
However, investors should understand that the addresses published by Bitwise will only show evidence of asset holdings and not evidence of the company’s reserves.
The U.S. Securities and Exchange Commission (SEC) has approved several spot Bitcoin ETFs, with products from BlackRock and Fidelity leading the way. BlackRock’s iShares Bitcoin Trust (IBIT) and Fidelity’s Wise Origin Bitcoin Fund (FBTC) collectively accounted for 70% of all inflows into BTC spot-traded products, with inflows of $1.9 billion and $1.6 billion, respectively. These two ETFs quickly reached $1 billion in assets under management (AUM), outperforming other funds approved by asset managers such as Bitwise and ARK 21Shares, which saw inflows of over $500 million.
In contrast, Grayscale’s Bitcoin Trust (GBTC) experienced significant outflows, losing approximately $4 billion in value shortly after the SEC approved the spot ETF. Despite being the largest spot BTC ETF with a market capitalization of over $20 billion and holding over 500,000 Bitcoins, Grayscale transferred approximately 93,700 BTC to the Coinbase Prime wallet. This move appears to have created selling pressure on BTC as funds liquidate tokens to meet redemption demands.
Grayscale’s ETF, which charges a 1.5% fee, the highest among its peers, has been criticized for its cost structure. CEO Michael Sonnenshein defended the fees, citing the ETF’s size, liquidity, and holding period as the oldest spot BTC ETF on the market. He noted that the new issuer offered low fees of as low as 0.21% to attract investors in a highly competitive market.