(Bloomberg) -- Bitcoin’s blistering rally produced record inflows into spot Bitcoin ETFs — and cemented the investor favorites in this new asset class. 

BlackRock Inc.’s iShares Bitcoin Trust (IBIT) and Fidelity Investments’ Wise Origin Bitcoin Fund (FBTC) have captured 79% of total inflows into the “Newborn Nine” — a popular name for the group of new exchange-traded funds that invest directly in Bitcoin — since the US Securities and Exchange Commission approved the assets Jan. 10.

Four of the remaining seven funds have responded by cutting fees below those of the two leaders, according to a Bloomberg analysis of data from the funds’ websites. Valkyrie Investments nearly halved its fee to 0.25% from the 0.49% it imposed right before the SEC approval. Franklin Templeton now offers a sector-low 0.19% after slashing its initial management charge by 10 basis points. Only Bitwise has made no change.

Bitcoin has been on a tear this year, topping $63,000 as retail investors wary of missing out snapped up the new ETFs. With firms pushing to lock down market share in a burgeoning asset class, this bifurcation among fund managers looks set to continue. 

“I expect further concentration among the top ETFs,” said Bryan Armour, director of passive strategies research at Morningstar Inc. “But others won’t go down without a fight. Fee wars should continue, which will keep pressure on the leaders to maintain their advantage.”

Grayscale Investment has taken a different approach since its Bitcoin trust converted to an ETF, choosing to maintain a management fee higher than its new rivals. Its fund (GBTC) has seen outflows of more than $8 billion since the launch, Bloomberg data show.

“The Grayscale team anticipated GBTC’s diverse shareholder base would engage in profit-taking and deploy investment strategies that would impact the Trust’s flows, and we are pleased that outflows stabilized over time,” a spokesperson for Grayscale said in a statement. “We expect GBTC will continue to be a primary capital markets risk transfer tool for Bitcoin.”

The selling has broadly eased, with daily outflows slowing to a daily average of $138 million in February from January’s $403 million. And Greyscale continues to be the biggest fund, with $26 billion of assets under management, compared to BlackRock’s $10 billion.

Meanwhile, there are signs that BlackRock is pulling ahead of Fidelity to dominate the sector. 

The New York-based firm’s IBIT fund won $612 million of new investment on Feb. 28, the most for a single day since it launched, and it’s taken in the majority of new flows for most of last month.

The world’s biggest fund manager’s distribution network potentially offers investors better liquidity than most rivals, said Todd Sohn, an ETF and technical strategist at Strategas Securities.

“The flows and volumes to BlackRock’s product reflect their commitment to this asset class,” Sohn said. “I like to believe they realize it’s a ‘new’ portion of an investment portfolio and are there to provide the access investors may want.”

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