- Bitcoin ETFs are gaining momentum due to client demand.
- Larry Fink’s transformation on Bitcoin has played a crucial role.
- Institutional adoption of Bitcoin ETFs is progressing slowly but steadily.
Bitcoin exchange-traded funds (ETFs) have seen a significant rise in demand, driven largely by client interest, according to BlackRock’s head of digital assets, Robert Mitchnick. Speaking at the Bitcoin 2024 event, Mitchnick discussed the evolution and current state of Bitcoin ETFs in an on-stage interview with Bloomberg journalist James Seyffart.
When Mitchnick joined BlackRock in 2018, CEO Larry Fink was a vocal skeptic of cryptocurrencies. However, Fink’s perspective has since shifted, and he now refers to Bitcoin as “digital gold.” Mitchnick credits Fink’s transformation to his extensive study of digital assets, noting that those with a strong background in financial history and technology, like Fink, tend to understand Bitcoin more easily.
Mitchnick emphasized that digital assets are not just a fleeting trend but have established themselves as a permanent fixture in the financial landscape. With institutional-grade infrastructure in place, the final push for Bitcoin ETFs came from client demand.
Bitcoin ETFs have seen unprecedented success. According to Seyffart, these ETFs have been some of the most successful launches in history. He estimated that 20-25% of BlackRock’s revenue this year has come from the iShares Bitcoin Trust (IBIT), making it the company’s second most successful offering after the S&P500 ETF.
Mitchnick noted that direct investors initially drove the demand for Bitcoin ETFs. However, wealth advisory and institutional investors are still gaining momentum. Major wealth advisory platforms such as Morgan Stanley, UBS, and Merrill Lynch have yet to offer Bitcoin ETFs on a solicited basis, typically requiring multiple years to reach that stage.