Milestone Alert: BlackRock’s Bitcoin ETF Crosses US$2 Billion in Assets Under Management
BlackRock, one of the world’s largest asset managers, is rapidly expanding into the crypto industry following the success of its Bitcoin ETF. Since its approval two weeks ago, the financial giant has led the pack, attracting billions of dollars in inflows and making notable milestones.
Adding to the optimism on bitcoin, the BlackRock bitcoin exchange-traded fund (ETF), which trades under the ticker IBIT, passed a milestone by surpassing US$2 billion in assets under management (AUM). Within weeks of its launch, industry sources indicate that IBIT currently holds over 52,000 BTC, worth more than US$2 billion at current market prices. Notably, IBIT saw huge trading volume rivaling Grayscale Bitcoin Trust (GBTC), underscoring the growing demand for bitcoin exposure among institutional investors.
Bloomberg ETF analyst James Seyfart discussed the impact of newly approved spot ETFs with effect from GBTC, which has experienced significant selling pressure since its shift to spot ETFs.
Bitcoin ETFs have been making waves in the TradFi industry since gaining approval on January 10, attracting a surge of investors looking to ride the hype around the financial product
BlackRock’s standing tall in other ways is largely due to its dominant position in the financial sector. After quietly stumbling on 11,500 bitcoins in the first two days of the ETF, the asset manager now manages an impressive 49,952 bitcoins, worth a staggering US$2 billion at press time.
The newly launched BlackRock Bitcoin ETF is the first of the new issuers to reach the milestone of raising more than US$2 billion in assets under management, with Fidelity close behind at US$1.8 billion AUM however the highest assets managed despite Grayscale Bitcoin Trust in the last couple of weeks. Its important liquidity has passed, and nearly US$5 billion has left its portfolio.
“The price of bitcoin has pushed IBIT’s assets well over US$2 trillion. This and potential additional revenue could mean more than US$2 trillion in the short term,” Bloomberg Intelligence analyst James Seyphart said in a post on the X forum.
Greyscale’s spot BTC ETF has about US$22 billion in AUM, but its product is an addition to the leading crypto-asset manager GBTC fund. Since then, the gap has narrowed somewhat as some investors withdraw from GBTC and other funds raise funds.
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Notably, BlackRock uses its market position as the world’s largest asset manager to attract a wider audience to its spot BTC ETF machine. Nate Geraci, president of the ETF Store, established that with more than US$2 billion in AUM, IBIT now owns the first three of more than 600 ETFs launched as of early 2023. Geraci also believes that the iShares BTC ETF will grab the top spot by next week.
BTC was one of the best-performing assets worldwide last year. It began trading in 2023 at less than US$17,000 and ended the year at more than US$42,000.
But the dormant crypto briefly hit around US$49,000 despite some pundits saying the price could rise following historic approvals and trading for highly anticipated ETFs on Wall Street.
Many market watchers and investors are now hoping that the upcoming bitcoin phase, when the supply of new BTC to miners drops by 50% could be a mega-bull catalyst for crypto prices. Continued if so these half-cases, which occur on a quadrennial basis, are already assessed.
Conclusion: The BlackRock Bitcoin ETF with over US$2 billion in AUM represents an important milestone in the mainstream adoption of cryptocurrencies. As institutional interest in digital assets grows, BlackRock’s leadership in the space underscores the growing recognition of cryptocurrencies as viable investments in today’s ever-changing financial landscape.
