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Grayscale’s Q1 2024 Earnings Take Hit amid Bitcoin ETF Outflows

On Thursday, May 9, Grayscale Investments reported its first-quarter earnings which took a hit amid strong outflows from its Grayscale Bitcoin ETF GBTC. While most crypto companies reported strong Q1 2024 numbers, the Grayscale revenue numbers stood flat as the company refused to divert from the high management fees charged by GBTC.

As per the shareholder letter from the parent firm Digital Currency Group, the operator of Grayscale Bitcoin Trust clocked $156 million in Q1 revenue. Ever since the ETF approval by the US SEC, Grayscale has seen net outflows of $17.5 billion. Amid its high management fees, a large number of investors have moved their holdings from GBTC to other low-cost Bitcoin ETF issuers such as BlackRock and Fidelity.

As we know, GBTC has been charging a management fee of 1.5%, while most of the other peers charge as little as 0.3%. Before the trust was converted, the firm imposed a 2% sponsorship fee. Grayscale also attributed the flat revenue to the higher average prices of Bitcoin and Ether, alongside the reduced assets under management. In its letter to shareholders, Digital Currency Group License.

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