Grayscale GBTC generated more annual revenues than all other U.S. spot BTC ETFs combined

However, GBTC’s $BTC has dropped about 70% since its ETF conversion in January 2024.

Before the debut, GBTC held about 619,000 BTC. Sixteen months later, the GBTC’s holdings dropped to 191,000 BTC, a nearly 70% decline in assets under management (AUM).

As shown by Geraci’s data, GBTC charged the highest fees of 1.5% while the rest of the products had an average cost of 0.15%-0.94%. Yet GBTC dominated the overall annual revenue.

According to Bloomberg ETF analyst Eric Balchunas, GBTC’s 1.5% fee was considered average in the traditional ETF market.

However, other analysts pointed out that most investors were captured in GBTC due to the heavy tax implications of switching to a cheaper alternative. Daniel Sempere, a business coach, stated,

“Paying the capital gains to switch out of GBTC is more painful than paying the extra fees, I guess.”

Simply put, the high fees and captive tax implications boosted GBTC earnings. However, can the expected approval of in-kind redemption for ETFs affect GBTC’s moat?

According to experts, in-kind redemption, using BTC instead of cash, would lower the tax burden, especially for large investors. Despite in-kind redemption being tax-efficient, individual investors sitting on massive unrealized gains will still face capital gains tax.

That said, GBTC ranked third on the AUM front with $17.8 billion. The BlackRock iShares BTC ETF topped the AUM list with $54.8 billion, followed by Fidelity’s FBTC at $18 billion.

After the slump in Q1 2025, the spot BTC ETFs saw renewed demand in April, with a whopping $3 billion in inflows.

This boosted BTC’s recovery to $94k, up 26% from the year’s low of $74.5k. In the short term, the $92K range low support and $100K overhead mid-range resistance were key levels to watch.