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Purpose Bitcoin ETF (BTCC)
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CI Galaxy Bitcoin ETF (BTCX.B)
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iShares Bitcoin Trust ETF (IBIT)
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Fidelity Wise Origin Bitcoin Fund Beneficial Interest (FBTC)
Q: Hi 5i team,
I am wondering if we should switch from the Canadian to the US spot Bitcoin ETFs, which have lower fees and higher liquidity. The US ETFs charge as low as low as 0.20%, while the Canadian ones charge around 0.88%. The US ETFs also have more trading volume and assets than the Canadian ones.
However, moving to the US ETFs would also involve some costs and risks, such as currency conversion, tax implications, and exchange rate fluctuations. It might also be too early to judge the performance of the US ETFs, as they are very new.
Please share your thoughts.
Best,
Matt
I am wondering if we should switch from the Canadian to the US spot Bitcoin ETFs, which have lower fees and higher liquidity. The US ETFs charge as low as low as 0.20%, while the Canadian ones charge around 0.88%. The US ETFs also have more trading volume and assets than the Canadian ones.
However, moving to the US ETFs would also involve some costs and risks, such as currency conversion, tax implications, and exchange rate fluctuations. It might also be too early to judge the performance of the US ETFs, as they are very new.
Please share your thoughts.
Best,
Matt
5i Research Answer:
There is a tradeoff with currency exchange fees and rates, however, the US ETFs are garnering more assets and have more competitive fees than the Canadian ETFs.
Some of the US ETFs are offering 0.0% fees for the first 6 months or until an AUM threshold is met. This tradeoff in fees from Canadian ETFs which are charging close to 1.0% may be worth the initial exchange rate fees. We feel that, for an investor looking to hold these ETFs for years, we would prefer the high liquidity, inexpensiveness, and high credibility of the US ETFs, particularly, IBIT and FBTC. In two trading days, IBIT has already managed to gather 1/4 the AUM as BTCC has over the past few years.