(Bloomberg) -- A lower-fee version of the world’s second-largest Bitcoin fund began trading in the US, intensifying competition for crypto investor flows.

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The Grayscale Bitcoin Mini Trust listed on Wednesday with a 0.15% expense ratio — the lowest for US exchange-traded funds holding the digital asset, fee waivers aside. The product is being seeded with 10% of the assets from the more than decade-old Grayscale Bitcoin Trust, which converted into an ETF in January.

The conversion occurred the same day that nine new Bitcoin ETFs from the likes of BlackRock Inc. and Fidelity Investments went live, a watershed for crypto that made Bitcoin more accessible and spurred a rally in the original cryptocurrency to a record high $73,798 of in March.

The new entrants slashed fees — in some cases to zero temporarily — to woo customers. The Grayscale Bitcoin Trust levies 1.5% and has seen an outflow of almost $19 billion since switching to an ETF structure, data compiled by Bloomberg show. It now ranks as the second-biggest Bitcoin fund, behind BlackRock’s iShares Bitcoin Trust.

Existing holders of the Grayscale Bitcoin Trust will automatically receive shares of the mini-fund pro-rata as a distribution into their accounts.

“The timing is also excellent for investors,” said Zach Pandl, head of research at Grayscale. “We have a Federal Reserve that is about to cut rates. Crypto has become an important topic in the US presidential election. The Trump platform may favor a dollar weakness, which could have implications for investors portfolios.”

The group of US Bitcoin ETFs has attracted $17.7 billion in net inflows since the listing of the products, part of a record-breaking debut for a fund category. The exits from the Grayscale Bitcoin Trust stood out against that backdrop.

The US Securities and Exchange Commission grudgingly approved spot-Bitcoin ETFs at the start of the year in the wake of a court reversal in 2023 in a case brought by Grayscale Investments LLC.

The asset manager created the Grayscale Bitcoin Trust in 2013 and for years it was the biggest such vehicle. It used to be a closed-end product that sometimes traded at substantial premiums or discounts to its net asset value, prompting Grayscale to push for a conversion into an ETF to ensure trading at par.

“GBTC is still going to be a very important part of the crypto landscape and investors who value trading volume and tight spreads may value that product relative to our new BTC product,” said Pandl.

ETFs investing in the No. 2 token by market value, Ether, have also received SEC approval and began trading in July.

The more than six-year-old Grayscale Ethereum Trust — the largest for Ether — converted from a closed-end structure into an ETF as part of the process. Grayscale also started the lower-fee Ethereum Mini Trust, which has attracted a net inflow of $181 million, while $1.8 billion has exited the higher-fee portfolio.

--With assistance from Vildana Hajric and James Seyffart.

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