"Do you think BlackRock will charge low or high?"
The approaching date for the approval of the spot Bitcoin (BTC) ETF has caused the cryptocurrency and broader financial community to speculate about what fees BlackRock might charge.
The first party to guess it was Bloomberg senior analyst Eric Balchunas who predicted the fee to be about 0.47% while Barry Ritholtz who is the CIO of Ritholtz Wealth Management sees the fee to be 0.35%.
Ritholtz also said that BlackRock could dominate the crypto space if they set fees as low as 0.25%, but Balchunas replied that the giant firm would charge between 0.40% and 0.60% as its intention was solely to generate significant income.
Additionally, Maximilian comically speculates a fee of 0.42069% and it's worth noting that Fidelity's S-1 reveals a competitive fee structure at 0.39% while Invesco Galaxy takes an aggressive approach following its first six-month fee waiver for $5 billion in assets.
The Financial Times also highlighted that BlackRock's dominance in the United States (US) ETF market is decreasing, therefore Vanguard and smaller players are quite difficult competition for BlackRock.
As of November 2023, iShares BlackRock reportedly manages about 32% of the US ETF market, which is down from 33.7% at the end of 2022 and a significant decrease from 39% at the end of the year.
While BlackRock's iShares aims to cater to a broad demographic, Vanguard focuses on stocks and bonds to capitalize on its reputation for low-cost strategies, said Bryan Armour, Morningstar's director of passive research.
Democrat Bernie Sanders highlighted the enormous influence of BlackRock and several other powerful firms as a potential risk to democracy after BlackRock along with Vanguard and State Street manage a staggering $20.7 trillion in assets.
