Fidelity and Galaxy Share Fees Scheme for Their Bitcoin ETF

According to a report from Fortune, the issuers of two Bitcoin exchange-traded funds (ETFs) have announced the fees they will charge their holders if their ETFs are approved.

Fidelity Investments has set a fee of 0.39% per year for its Wise Origin Bitcoin Trust, while Galaxy/Invesco will charge 0.59% per year for its BTCO fund. However, Galaxy/Invesco will waive the fee for the first six months of the fund’s operation.

The information was reported in a court filing on Dec. 29. The report also revealed that Jane Street Capital will be the “authorized participant” for the Bitcoin ETFs of Fidelity, WisdomTree, and Valkyrie, giving them the ability to arbitrage price differences between the funds’ shares and Bitcoin itself.

In addition to Jane Street, both Valkyrie and BlackRock have named JPMorgan and Virtu as their authorized participants. The ETFs will use a “cash” model for creation and redemption, meaning that authorized participants will not purchase and deposit actual Bitcoin into the funds.

Instead, they will deposit the cash equivalent for the desired amount of Bitcoin, which will then be used by the fund to purchase BTC.