Asset management giant BlackRock says it is seeing increased interest in Bitcoin exchange-traded funds from institutional players such as sovereign wealth funds and pension funds.
This follows the highly successful debut of BlackRock's Bitcoin ETF, iShares IBIT, which was approved by the SEC earlier this year.
BREAKING: BlackRock says “sovereign wealth funds, pension funds and endowments” are coming #Bitcoin
Institutions come big time 🚀 pic.twitter.com/GLcpMJYkYz
— Bitcoin Magazine (@BitcoinMagazine) May 2, 2024
The US spot Bitcoin ETF market exploded in 2024, exceeding $200 billion in volume since its launch. Recent 13F filings have shown that major institutional buyers are making small allocations to the newly regulated Bitcoin products.
Now, despite the recent slowdown and outflows from Bitcoin ETFs amid market volatility, BlackRock remains optimistic about long-term institutional demand. The company's head of digital assets, Robert Mitchnik, said in an interview that he expects sovereign wealth funds, pensions and endowments to begin trading Bitcoin exchange-traded funds in the coming months.
BlackRock has been in educational conversations with these institutions about Bitcoin for years, Mitchnik said. The asset manager is unfazed even after iShares IBIT saw its first ever outflows this week after 71 consecutive days of inflows.
Mitchnick believes the current lull will be followed by a new wave of buying from deep-pocketed institutions. As more giants like BlackRock build billions of dollars in Bitcoin reserves, they validate Bitcoin as an investable asset class.
The ETF talks also come as BlackRock CEO Larry Fink has softened his critical stance on Bitcoin.
With iShares IBIT quickly accumulating over $17 billion in Bitcoin, BlackRock has demonstrated the massive underlying demand for regulated Bitcoin investment vehicles.
Despite ETF outflows in the short term amid volatility, their long-term outlook remains very optimistic.
As Mitschnick noted, “Many of these interested firms — whether we're talking about pensions, endowments, sovereign wealth funds, insurance companies, other asset managers, family offices — are doing ongoing diligence and research conversations, and we play a role from an education perspective.”
Overall, this educated and pragmatic institutional interest bodes well for the continued growth of the Bitcoin ETF market.
