Summary
- Eric Balchunas said Charles Schwab’s cryptocurrency trading service may have limited competitiveness compared with ETFs.
- Schwab’s fee is about 0.75%%, while ETFs charge around 0.02%%, marking a wide cost gap.
- Balchunas added that buying directly for holdings of more than five years may be more suitable, while ETFs could be a better choice for shorter investment periods.
Forecast Trend Report by Period
Charles Schwab’s cryptocurrency trading service may struggle to compete with existing exchange-traded funds, with fees emerging as the key factor.
Decrypt reported on June 16 that Bloomberg ETF analyst Eric Balchunas expects Schwab’s crypto trading offering to be less competitive than ETFs.
Schwab’s fee is about 0.75%, compared with roughly 0.02% for ETFs, leaving a wide cost gap.
Schwab could still be a better option than crypto exchanges for novice investors, however. Easier access through an established financial platform may work in its favor.
Balchunas also highlighted that directly holding cryptocurrency does not carry an ongoing management fee over the long term. That could make direct purchases more attractive for long-term investors.
For investors planning to hold for more than five years, buying directly may be the better choice, while ETFs may be more suitable for shorter investment periods, he added.
As competition intensifies among traditional financial platforms, ETFs and crypto exchanges, fees and accessibility are expected to remain the main factors shaping investor choice.
JH Kim
reporter1@bloomingbit.ioHi, I'm a Bloomingbit reporter, bringing you the latest cryptocurrency news.
