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In this edition:
Grayscale CEO: Most of 11 Approved Bitcoin ETFs Won’t Survive
Hong Kong Firm Set to Apply for Spot Bitcoin ETF
‘Bitmain is a Hidden Self-mining Giant’ – BlocksBridge Consulting
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Grayscale CEO: Most of 11 Approved Bitcoin ETFs Won’t Survive
Grayscale Investments CEO Michael Sonnenshein told CNBC that most of the 11 approved spot bitcoin exchange-traded funds (ETFs) will not survive.
More specifically, two to three of the new ETFs “will maybe obtain some kind of critical mass” of assets under management (AUM). The others may be pulled from the market.
He stated,
“I don’t ultimately think that the marketplace will have ultimately these 11 spot products we find ourselves having.”
Connected to this, the CEO discussed Grayscale’s fees compared to its competitors. While many ETF issuers went fee-less for a limited time before raising them to 0.2%-0.4%, Grayscale charges a 1.5% fee.
Sonnenshein argued that other ETFs have lower fees because the products “don’t have a track record.” Also, the issuers are trying to attract investors with fee incentives.
Meanwhile, Grayscale is the largest bitcoin fund, with a 10-year track record of “operating successfully” and a diversified investor base, he said.
Sonnenshein opined that,
“I think from our standpoint, it may at times call into question their long-term commitment to the asset class.”
Grayscale is a crypto specialist that paved the way for many arriving products, the CEO stated. He added that investors are “weighing heavily” factors such as the product’s issuer, liquidity, and track record.
Read more: Bitcoin ETF Essential Facts: Prices, Winners, Losers, Tickers and Fees
Hong Kong Firm Set to Apply for Spot Bitcoin ETF
Hong Kong financial services company Venture Smart Financial Holdings (VSFG) said it plans to apply with the Securities and Futures Commission (SFC) to start an ETF investing directly in BTC this quarter, Bloomberg reported.
Brian Chan, group head of investment and product at VSFG, commented:
“It’s a market that has huge potential. […] Our goal is $500 million in assets under management by the end of this year.”
Hong Kong allows futures-based crypto ETFs. Three that have listed so far – CSOP Bitcoin Futures, CSOP Ether Futures, and Samsung Bitcoin Futures – have combined assets of $50 million.
Samsung Asset Management commented that it wouldn’t “eliminate the possibility of exploring to launch a spot ETF,” said the report.
The SFC refused to comment beyond the guidelines it published in December. The report noted that the approval process could take weeks, even months.
Read more crypto news: About 10 Fund Companies Preparing to Launch Spot Crypto ETFs in Hong Kong: HashKey Group
‘Bitmain is a Hidden Self-mining Giant’ – BlocksBridge Consulting
Bitcoin mining hardware giant Bitmain both sells mining equipment and operates self-owned machines, thus competing against its customers, according to the latest Miner Weekly report by BlocksBridge Consulting.
Citing TheMinerMag’s research and the recent filings from Bitmain-backed BitFuFu, the report said that Bitmain got nearly 65% of the company’s cloud mining and self-mining revenues in H1 2023.
Per Miner Weekly,
“Bitmain may seem to be a minority shareholder of BitFuFu with 5%, but it is clear that BitFuFu’s business depends on Bitmain so much that Bitmain effectively owns it.”
BitFuFu had two business lines in H1 2023: proprietary and cloud mining. A majority of the hashrate came from the S19XP miners it rented from Bitmain.
Furthermore, Bitmain provided the hosting capacities for BitFuFu “to plug in all the hashrate across US states and some other countries.”
Therefore, nearly 80% of BitFuFu’s revenue costs in the first half of last year went to Bitmain. In other words, 65% of every BitFuFu-made dollar was Bitmain’s.
Per the report, given Bitmain’s recent hosting deal with Core Scientific, it can be assumed that Bitmain and BitFuFu combined operate at least 20 EH/s.
Read more crypto news: Bitcoin Mining Difficulty & Hashrate Set Records as Bitmain Floods US with Machines
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