According to Cointelegraph: CEO of Grayscale Investment, Michael Sonnenshein, believes that majority of the 11 spot Bitcoin exchange-traded funds (ETFs) recently approved by the U.S. Securities and Exchange Commission (SEC) will not survive.
In a recent interview at the World Economic Forum in Switzerland, Sonnenshein forecasted the failure of most spot Bitcoin ETFs, in spite of providers reducing their trading fees to enhance competitiveness against other ETF sponsors. Temporary fee waivers were also offered by several spot Bitcoin ETF providers.
Grayscale, the largest Bitcoin holder among the issuers of spot Bitcoin ETFs, currently charges as high as 1.5% with no waivers. Sonnenshein defended this strategy, stating that only two or three spot Bitcoin ETFs are here to stay while the rest will be withdrawn from the market:
“I think from our standpoint, it may at times call into question their long-term commitment to the asset class [...] I don’t ultimately think that the marketplace will have ultimately these 11 spot products we find ourselves having.”
This comes as Grayscale has become aggressive on BTC selling after the launch of spot Bitcoin ETF trading in the U.S, offloading as much as 37,947 BTC by January 18. On the contrary, the other nine issuers have added a minimum of 40,000 BTC to their products since the start.
Mati Greenspan, founder of Quantum Economics, did not dismiss the possibility of most ETF issuers failing in the long run, noting most investors would rather opt for holding their assets or self-custody. He regards the existence of 11 spot ETFs as "pretty ridiculous," and anticipates a market consolidation due to the current low fees.
