Industry Updates

BlackRock bitcoin ETF hits $10bn in record time

IBIT has surpassed Grayscale's GBTC as the biggest spot bitcoin trading vehicle

Lucy Brewster


Blackrock's physical bitcoin ETF hit $10bn assets under management (AUM) on 1 March, the fastest ETF to ever hit the milestone.

The iShares Bitcoin ETF (IBIT) reached the milestone just seven weeks after launching on 11 January, on the heels of a week of record trading and inflows for the group of 10 trading spot bitcoin ETFs, according to Bloomberg Intelligence data.

IBIT saw $604m inflows on 29 February, a day after hitting a single-day record of $612m inflows.

Eric Balchunas, ETF analyst at Bloomberg Intelligence, said over three-quarters of IBIT’s AUM are from flows, and the rest from price gains.

BlackRock's speed record breaks that of the SPDR Gold Shares (GLD), which took more than two years after its 2004 launch to reach $10bn AUM, according to senior analyst Sumit Roy.

BlackRock sought permission from the Securities and Exchange Commission (SEC) to launch its bitcoin ETF in June 2023, a decade after the Winklevoss twins applied to create such a vehicle.

Analysts argue the firm’s spot bitcoin ETF filing is a turning point in the decade-long regulatory battle between the SEC and ETF issuers vying to bring the first spot bitcoin fund to market.

“I am not surprised that BlackRock is in the lead. They were the catalyst that put attention back on the spot bitcoin ETF filings last summer,” Bryan Armour, ETF analyst at Morningstar, said.

“What I am surprised at is BlackRock has already supplanted Grayscale’s GBTC in terms of being the main trading vehicle for bitcoin.”

IBIT and bitcoin surge

While the SEC has allowed funds that give exposure to bitcoin futures since 2021, the regulator rejected dozens of applications for an ETF that owns bitcoin and trades on its spot price.

The watershed approval took place on 10 January and a slew of firms, including Fidelity Investments and Bitwise Asset Management, started trading their funds the next day.

The cryptocurrency is up 20% in the past five days and 44% over the past month. The bitcoin price broke $60,000 on Wednesday, the first time its price was that high since November 2021, according to data from Coindesk.

As bitcoin’s price has skyrocketed over the past week, assets in all spot bitcoin ETFs have surged, along with the rally attracting fresh money.

Financial services platforms such as Bank of America Merrill Lynch and Wells Fargo put spot bitcoin ETFs on their brokerages this week, opening another channel for flows.

Spot bitcoin ETF success

Since their launch, the spot bitcoin ETFs have been lauded as a historic success, validating cryptocurrency bulls and surprising critics with their reception from ETF investors.

After IBIT, the next spot bitcoin fund with the most assets is Fidelity’s Wise Origin Bitcoin Fund (FBTC), which has about $6.5bn AUM, followed by the $2.1bn ARK 21Shares Bitcoin ETF (ARKB) and the $1.5bn Bitwise Bitcoin ETF (BITB).

Investors appear to be drawn to funds with a combination of low fees, a recognisable brand and cryptocurrency expertise.

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