Valkyrie has enlisted BitGo as an additional custodian for its Bitcoin ETF, along with Coinbase Trust Company. The move aims to diversify custodial services, minimising risks associated with ETF custody.
“The Sponsor anticipates utilising the custodial services of both Coinbase and BitGo to custody the Trust’s bitcoin,” Valkyrie said.
Excited to announce @ValkyrieFunds has selected BitGo as their qualified custodian for its Bitcoin ETF ($BRRR).
Providing secure Institutional access to digital assets together 🤝https://t.co/BgkkJZTHs9
— BitGo (@BitGo) February 1, 2024
BitGo now serves as custodian for two spot Bitcoin ETF issuers, including Hashdex, while Coinbase predominantly covers most launched spot Bitcoin ETFs.
BitGo’s CEO, Mike Belshe, emphasised the importance of custodial diversification to mitigate risks, highlighting the significance of this development for the industry. Bloomberg ETF analyst James Seyffart suggested that other ETF issuers might follow Valkyrie’s lead.
Valkyrie has added @BitGo as a custodian for their #Bitcoin ETF. This is a huge win for the industry as we partner to secure their assets.
Kudos to @valkyriefunds, @LeahWald and @stevenmcclurg for leading the industry with the best approach to mitigate risk in ETF custody. https://t.co/MsSOtZGJ09
— Mike Belshe (@mikebelshe) February 1, 2024
Valkyrie’s spot Bitcoin ETF, known as BRRR, holds approximately $113.5 million in Bitcoin, making it the seventh-largest holder among spot Bitcoin ETF issuers. Notably, BlackRock and Fidelity lead in Bitcoin holdings among new Bitcoin ETF issuers.
Competition among ETF issuers has intensified, with marketing and fee reductions becoming common. Invesco and Galaxy recently slashed their management fees, with BlackRock, ARK 21Shares, and others following suit. Grayscale Investments, having converted its Bitcoin trust into a spot ETF, currently charges the highest management fee at 1.5%.
These developments come after the green light from U.S. securities regulators on Jan. 10, paving the way for the launch of spot Bitcoin ETFs on Jan. 11.