BlackRock: Sovereign Wealth, Pension Fund Considering Bitcoin ETF

Asset management giant BlackRock said it is seeing increasing interest in Bitcoin ETFs from institutional players such as sovereign wealth funds and pension funds.

This comes after the huge success of iShares IBIT, BlackRock’s Bitcoin ETF, which received approval from the Securities and Exchange Commission earlier this year.

BREAKING NEWS: Blackrock says “sovereign wealth funds, pension funds and endowments” are coming. #Bitcoin

Institutions are growing significantly 🚀 pic.twitter.com/GLcpMJYkYz

— Bitcoin Magazine (@BitcoinMagazine) May 2, 2024

The U.S. spot Bitcoin ETF market has grown explosively, with trading volume exceeding $200 billion since its launch in 2024. Recent 13F filings show that major institutional buyers have allocated small sums to newly regulated Bitcoin products.

Now, despite the recent pause and outflow of the Bitcoin ETF amid market volatility, BlackRock remains bullish on institutional demand for the long term. Robert Mitchnick, the company’s head of digital assets, said in an interview that he expects sovereign wealth funds, pensions and endowments to begin trading physical Bitcoin ETFs in the coming months.

Mitchnick said BlackRock has been having educational conversations with these institutions about Bitcoin for several years. Asset managers were unfazed after iShares IBIT saw outflows for the first time this week following 71 consecutive days of inflows.

Mitchnick believes the current lull will be followed by a new wave of purchases from deep-pocketed institutional investors. As more giants like BlackRock acquire billions of dollars worth of Bitcoin reserves, it validates Bitcoin as an investable asset class.

The ETF discussion comes as BlackRock CEO Larry Fink softens his once critical stance on Bitcoin.

With iShares IBIT quickly accumulating over $17 billion in Bitcoin, BlackRock has demonstrated the enormous potential demand for a regulated Bitcoin investment vehicle.

Despite short-term ETF outflows amid volatility, the long-term outlook remains very optimistic.

As Mitchnick puts it, “Many interested entities – pensions, endowments, sovereign wealth funds, insurance companies, other asset managers, family offices – are engaging in ongoing efforts and research conversations, and we are taking on an educational perspective.”

Overall, this educated and pragmatic institutional interest bodes well for the continued growth of the Bitcoin ETF market.