BlackRock (BLK), VanEck, ARK Investment Management LLC, and Bitwise Asset Management Inc., are among the firms hoping to launch a spot bitcoin ETF, and their recent Securities and Exchange Commission (SEC) filings show that they are planning to undercut the average market rate for ETF investor fees in the U.S.

Bitwise on Tuesday lowered the bar with disclosure of a planned 0.20% management fee for its spot bitcoin ETF, compared with the 0.37% average for existing U.S. ETF products and mutual funds in 2022, the latest data available, according to Morningstar Inc. investment research data. Given that all ETFs track bitcoin, the fees they charge could help investors set them apart.

Bitwise is followed by VanEck, and ARK Invest's 21Shares with planned 0.25% ETF expense fees, and BlackRock is set to charge 0.30%. BlackRock added fuel to a rally in bitcoin last year after it submitted its bitcoin ETF application.

The SEC has until Wednesday to decide on the first spot bitcoin ETF application, and a Bloomberg ETF analyst said the chance of rejection by the regulator has fallen to just 5%.

Crypto enthusiasts are hopeful that a Bitcoin spot ETF will lead to an increase in institutional and retail investor adoption. Investment bank Standard Chartered Monday said in a research note that it expects investment flows of $50 billion to $100 billion in 2024 alone once an ETF is approved.

ETF providers are hungry for potential investment inflows and have heated up the fee arms race with waiver periods. Bitwise said it would waive fees for new spot bitcoin ETFs for the first $1 billion invested for its fund's first six months, while BlackRock set a waiver period of 12 months or the first $5 billion invested. The 21Shares Bitcoin ETF, released in partnership with ARK Invest, said its waiver would be for six months, or the first $1 billion invested in its bitcoin ETF, with a fee of 0.25% after.