February 16, 2024

Fidelity Cuts Bitcoin ETP Fees in Europe, Strengthening Market Position

Fidelity is strategically positioning itself in Europe by slashing its bitcoin ETP fees.

Fidelity, a leading asset manager, has announced a significant reduction in fees for its bitcoin Exchange-Traded Product (ETP) in Europe, demonstrating its strategic move to stay competitive in the evolving crypto market landscape. The Fidelity Physical Bitcoin ETP (FBTC) will now feature a reduced total expense ratio (TER) from 0.75% to 0.35%, marking a substantial decrease aimed at enhancing its appeal and accessibility to investors.

Eric Balchunas, Senior ETF Analyst at Bloomberg, highlighted the importance of Fidelity's fee reduction, noting the adjustment from 75 basis points (bps) to 35 bps. This decision by Fidelity follows a broader trend among crypto issuers in Europe, including Invesco, WisdomTree, and CoinShares, who have also recently lowered their fees. The move comes amidst heightened competition spurred by the introduction of 11 spot bitcoin ETFs in the United States, igniting a price war among asset managers in Europe as they vie to capture institutional interest in crypto products.

Christian Staub, Managing Director Europe at Fidelity, emphasized the impact of the approval of spot bitcoin ETFs in the U.S. on global investor sentiment towards cryptocurrencies. Staub noted:

"We have had numerous conversations with clients over the past months as they are rightly asking for an efficient way to benefit from this trend."

Fidelity's fee reduction aims to meet the surging demand for crypto exposure and broaden access to the bitcoin asset class through their ETP offering. With investors increasingly prioritizing cost-effective investment options, ETF and ETP providers face mounting pressure to lower fees to remain competitive. By aligning FBTC's fee structure with its peers, such as WisdomTree and CoinShares, which have also reduced fees to 0.35%, Fidelity underscores its commitment to adapting to investor needs while maximizing value for its clients.

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