Grayscale Bitcoin Mini Trust dominates via fee undercut and AUM growth

BTC undercuts rivals with 0.15% fee

The Grayscale Bitcoin Mini Trust (BTC) charges an annual expense ratio of 0.15%, which stays below the 0.25% fee for BlackRock’s iShares Bitcoin Trust and the 0.20% fee for Bitwise’s BITB. This low cost makes BTC a competitive option for investors seeking Bitcoin exposure through a brokerage account. Franklin Templeton’s EZBC charges 0.19% for its fund. As BTC reaches $8 billion in assets under management this October, the fund demonstrates an ability to attract capital away from more expensive products. This growth provides Grayscale with a way to compete against other issuers without losing the revenue from the flagship Grayscale Bitcoin Trust (GBTC). Both BTC and GBTC are 1933 Act trusts that hold Bitcoin through a custodian. They are not registered investment companies, so they file a 10-K rather than an N-PORT. BTC launched on July 31, 2024, while GBTC listed on January 2, 2020. The BTC fund provides a low-cost way to get the coin’s return inside a brokerage account.

Fund	Expense Ratio	1-Year Return	3-Month Return
BTC	0.15%	-30.5%	+37.0%
GBTC	1.50%	-31.4%	+36.7%
IBIT	0.25%	-45.6%	N/A
BITB	0.20%	-45.6%	N/A

Performance gaps and tracking errors

The difference between the annual return of the BTC fund and the actual price of Bitcoin remains minimal because the 0.15% fee only represents a small portion of the 0.56 percentage point gap between the two assets. Over the one year ending October 2, 2026, Bitcoin moved -29.94% while BTC returned -30.5%. In comparison, GBTC returned -31.41% over the same period, leaving it 1.47 percentage points behind the coin. The BTC fund saw a 37.0% return over the last 3 months and a 25.6% return over the last 6 months. Since its listing on July 31, 2024, BTC returned 28.7% while Bitcoin returned 30.8%, leaving the fund 2.1 percentage points behind. GBTC showed a 36.7% return over the last 3 months and a 24.9% return over the last 6 months. GBTC has 1,672 more days of record than BTC, which provides a longer window for costs to show. BTC holds a Coin Capture Score of 97.8, while GBTC holds a score of 2.2 in a set of 23 spot crypto ETPs.

Institutional concentration in IBIT and FBTC

Institutional allocators prioritize liquidity and issuer reputation when selecting Bitcoin products. BlackRock and Fidelity dominate the market by capturing most institutional inflows. On May 1, 2026, IBIT and FBTC combined for $497.8 million of the $629.8 million in total daily inflows. On January 14, 2026, IBIT and FBTC accounted for over 90% of the $840.6 million in total inflows. Smaller issuers such as VanEck’s HODL and Franklin Templeton’s EZBC struggle to compete against this concentration. Even earlier competitors like Bitwise’s BITB and Ark’s ARKB have lost influence to the market leaders. Trump Media & Technology Group abandoned plans for a proposed spot Bitcoin ETF earlier this year. IBIT alone maintained a 30-day average volume of 35,677,747 shares as of August. IBIT held $48.42 billion in assets as of August 7, while FBTC held $10.81 billion as of July 31, 2026.

The strategy behind Grayscale’s two-tiered model

The $8 billion AUM flip for BTC proves the 0.15% fee effectively attracts investors away from the 1.50% fee of GBTC. Grayscale created the BTC trust to help long-term GBTC holders avoid capital gains taxes by providing a way to transition without a taxable event. This strategy helps Grayscale retain its assets when customers look for more economical options. The low fee also gives salespeople a competitive tool for advisors who find a 1.50% fee an instant dealbreaker. You can see the advantage of the BTC fee when comparing the $15 annual cost on $10,000 to the $25 cost of IBIT. GBTC has seen outflows exceeding $11 billion since it launched. James Seyffart of Bloomberg noted the Mini ETF helps taxable holders who were stuck with potential capital gains tax hits. Eric Balchunas of Bloomberg said the BTC fee gives something competitive for salespeople to have when talking to advisors. Will the concentration of assets in BlackRock and Fidelity eventually prevent Grayscale from expanding BTC’s market share further?