Less than a week after VanEck announced that it would lower the fees it charges on spot Bitcoin ETFs, the investment manager’s fund has seen a huge surge in trading volume.
On Tuesday, VanEck’s Spot Bitcoin ETF topped $300 million in trading volume as of 1:50 PM ET. This is more than 10 times the volume on our best day to date. VanEck’s cryptocurrency-backed ETF hit an all-time high of $25.5 million in daily trading volume when it launched on January 11, according to Yahoo Finance data compiled by The Block.
Bloomberg Senior ETF Analyst Eric Balchunas went to To express surprise at how well the fund is performing. VanEck’s ETF is “already seeing a frenzy today with $258 million in trading volume, 14x better than the daily average,” he posted. “And it’s not just one big investor (which makes sense), it’s 32,000 individual transactions, averaging 60x.”
“Because ETFs trade on secondary markets, it can be difficult to know who is buying them and why,” Ed Lopez, head of ETF products at VanEck, told The Block. “Today’s trading showed tremendous volume at tight spreads, which is ultimately what you want from an ETF, regardless of whether the market is bullish or bearish.”
VanEck’s ETFs have struggled to keep pace with products offered by dominant BlackRock, Fidelity and Grayscale in terms of daily trading volume since the new financial products were launched last month. BlackRock and Fidelity both charge a 0.25% fee for their products, but the fee is partially waived for early investors. Last week, VanEck notified the Securities and Exchange Commission that it would lower its fees from 0.25% to 0.20% starting Feb. 21, or tomorrow, in a sign that it potentially wants to compete on price.
“We have publicly applied to lower HODL’s fees and have seen strong interest in our funds, including significant participation from retail investors,” Lopez said.
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