Bitcoin
BlackRock ETF becomes the world’s largest bitcoin fund, reports Bloomberg News
By Suzanne McGee
(Reuters) – BlackRock’s iShares Bitcoin Trust has become the world’s largest fund for the world’s largest cryptocurrency, accumulating nearly $20 billion in total assets since it listed in the U.S. in January, Bloomberg News reported on Wednesday.
The exchange-traded fund held $19.68 billion worth of tokens as of Tuesday, surpassing the Grayscale Bitcoin Trust’s $19.65 billion, the report said, citing data compiled by Bloomberg.
Reuters was unable to independently verify these figures. Grayscale’s product website cites its assets under management as $19.75 billion. A spokesperson could not be reached for comment.
When the nine new ETFs were launched in January, Grayscale’s fund had about $29 billion in assets.
Market analysts have been keeping a close eye on relative flows into the BlackRock ETF and out of the Grayscale Bitcoin Trust since U.S. regulators approved the launch of nine new ETFs and the conversion of Grayscale’s publicly traded fund into an exchange-traded product. on January 10th. .
The Securities and Exchange Commission, led by crypto skeptic Gary Gensler, rejected spot bitcoin ETFs for more than a decade due to market manipulation concerns, but approved them in January after Grayscale Investments won a court challenge that year. past.
This proved to be a short-lived victory for Grayscale, which has been hit by constant outflows since its newly converted ETF began trading on January 11.
BlackRock’s growing dominance in the new ultra-competitive bitcoin spot landscape “is a reminder that being the first to act doesn’t necessarily mean someone ends up as the biggest winner,” said Aniket Ullal, head of ETF data and analytics at CFRA. First-time incumbents may have inherited disadvantages, he noted.
From the start, Grayscale has battled headwinds ranging from selling pressure and a 1.5% fee, notably higher than the average of around 0.25% charged by its new rivals, which also include the likes of Fidelity Investments. and ARK Investments.
Meanwhile, CFRA’s Ullal noted that BlackRock has benefited from its strong distribution network among independent financial advisors and wealth managers.
“We are seeing significant assets moving into the ETF from the wealth community” as well as individual advisors, Jay Jacobs, head of U.S. asset and thematic ETFs, told Reuters on Tuesday, ahead of the Bloomberg report.
“Many of the early adopters have moved from direct ownership of digital assets to IBIT,” Jacobs added. “Some of these accounts had millions of dollars” invested in the cryptocurrency.
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While some hedge funds reported large positions in the new ETFs at the end of the first quarter, other institutional investors were slower to adopt the new bitcoin ETFs.
“We know this will be the longest process,” Jacobs said of these institutional buyers. “In some cases, it can take years.”
(Reporting by Suzanne McGee, additional reporting by Jaiveer Singh Shekhawat in Bengaluru; Editing by Vijay Kishore and Chizu Nomiyama)