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In less than nine months since the launch of its Bitcoin exchange-traded fund (ETF) following approval of these investment vehicles by the US Securities and Exchange Commission (SEC), asset manager BlackRock has established itself as the largest Bitcoin fund in the world.
A Tale of Two Titans in Bitcoin and Ethereum Holdings
According to on-chain data from blockchain analytics platform Arkham, BlackRock has aggressively expanded Bitcoin Holdings through its ETF, known as IBIT in recent months.
Despite the recent market volatility that saw a significant dip in the price of Bitcoin on August 5 and September 6, BlackRock continued to buy more Bitcoin, thus supporting not only the value of the token but also its asset base.
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As of September 25, BlackRock’s to hold they have reached about 358,000 BTC, with an estimated value of $22.76 billion, representing about 1.70% of the total Bitcoin supply of 21 million.
In comparison, BlackRock’s Bitcoin holdings exceed that of Grayscale, the industry’s other largest crypto asset manager, by nearly 100,000 BTC. Grayscale for now he catches approximately 258,671 BTC, valued at $16.45 billion, highlighting the significant gap BlackRock has created in the BTC investment landscape.
While BlackRock has taken the lead in Bitcoin, Grayscale is keeping an interest in it Ethereum (ETH) to hold. Arkham data shows that Grayscale has 2.104 million ETH, which is worth an estimated $5.45 billion based on the current trading price of $2,600 per ETH. In contrast, BlackRock’s Ethereum Holdings amount to only 349,970 ETH, with an estimated value of $910 million.
BlackRock Strengthens Bitcoin Position
BlackRock’s support for Bitcoin goes beyond just investing; it includes strict licensing of the technology that supports cryptocurrency. The latest interview with Bloomberg, Robbie Mitchnick, head of digital assets at BlackRock, challenged the prevailing view that Bitcoin should be classified as a “vulnerable” asset.
During Tuesday’s interview, Mitchnick noted that although Bitcoin has recently shown a high correlation with US stocks, this correlation may be misleading.
BlackRock’s head of digital assets noted that risk assets, such as stocks, commodities, and high-yield bonds, perform well over time market prospect and economic growth. In contrast, assets such as gold are sought after in times of uncertainty, providing a safe haven for investors.
Mitchnick drew parallels between Bitcoin and gold, saying “gold shows many of the same patterns”, referring to their temporal relationship with equities. He emphasized that the long-term correlation between BTC and traditional financial assets is close to zero.
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One of BTC’s defining characteristics is its decentralized nature, Mitchnick added. No one country or government controls it, he said, adding to its appeal as a global financial alternative.
Mitchnick went on to highlight Bitcoin’s scarcity, global reach and decentralization framework, describing it as a “non-sovereign asset”. He pointed out that BTC has no country risk and no country risk, making it a compelling option for investors looking to diversify their portfolios.
At the time of writing, the largest cryptocurrency in the market has given back some of the gains made during Tuesday’s trading session, after hitting a one-month high of $64,700. Currently, BTC is trading at $63,220, down 0.3% in the last 24 hours.
Featured image from DALL-E, chart from TradingView.com