Grayscale’s Bitcoin ETF hits $1.6b outflows hours before halving

Grayscale AUM down 50% in four months

GBTC may have been the largest spot Bitcoin ETF at launch due to its 10-year headstart, but the BTC-backed investment product has lost huge market share to new players like BlackRock.

As crypto.news reported, GBTC has declined around 50% in assets under management (AUM) in four months of trading. Grayscale had less than $20 billion in AUM, while BlackRock commands over $17 billion in investor demand.

Experts like Bloomberg’s Eric Balchunas attributed swathes of GBTC exits to ongoing bankruptcy proceedings like FTX and Genesis. Other observers have also mentioned Grayscale’s industry-high fund fee of 1.5% as another contributing factor to liquidations.

In response, Grayscale CEO Michael Sonnenshein shared plans to slash GBTC fees “over time.” The company also proposed a Bitcoin Mini Trust ETF to field lower fees and recapture demand in the market.