FCA Lifts UK Retail Ban Sparks 0.05% Crypto ETN Fee War
On October 8, the UK’s Financial Conduct Authority lifted its 2021 ban on retail investors buying crypto ETNs. Immediately, issuers like 21Shares, Fidelity and CoinShares cut ETN fees to record lows of 0.05% and even zero. Some products still charge up to 2.5% per year. Notable offerings include 21Shares Core Bitcoin and Ethereum Core Staking ETPs at 0.1%, Fidelity Physical Bitcoin ETP at 0.25% and CoinShares Physical Staked Ethereum ETP with no management fee. This fee war aims to restore the UK’s role in global crypto adoption. It aligns with ongoing stablecoin regulation debates at the Bank of England and US moves such as the GENIUS Act. Traders should watch crypto ETN fee trends and regulatory updates. Retail inflows may rise, boosting liquidity and market growth.
Bullish
The fee cuts and ban lift lower barriers for retail investors to buy Bitcoin and Ethereum via ETNs. In the short term, record-low ETN fees can attract new inflows, increasing buying pressure on BTC and ETH and improving liquidity. Over the long term, enhanced retail participation and intensified competition among issuers may sustain demand and support higher price floors. Historical precedents show that easier access and lower costs drive adoption and price appreciation in crypto markets.