BlackRock: Sovereign Wealth, Pension Funds Considering Bitcoin ETFs

Asset management giant BlackRock says it is seeing growing interest in Bitcoin ETFs from institutional players like sovereign wealth funds and pension funds. 

This comes after a hugely successful debut for BlackRock's Bitcoin ETF, iShares IBIT, which was approved by the Securities and Exchange Commission earlier this year.

BREAKING: Blackrock says “Sovereign wealth funds, pension funds and endowments” are coming to #Bitcoin

Institutions are coming big time ???? pic.twitter.com/GLcpMJYkYz— Bitcoin Magazine (@BitcoinMagazine) May 2, 2024

The U.S. spot Bitcoin ETF market has exploded in 2024, crossing $200 billion in volume since launch. Recent 13F filings have shown major institutional buyers making small allocations to these newly regulated Bitcoin products.

Now, despite a recent cooldown and outflows from Bitcoin ETFs amidst market volatility, BlackRock remains bullish on institutional demand long-term. The firm's head of digital assets, Robert Mitchnick, said in an interview he expects sovereign wealth funds, pensions, and endowments to start trading spot Bitcoin ETFs in the coming months.

Mitchnick stated that BlackRock has been in educational conversations with these institutions about Bitcoin for years. The asset manager is unfazed even after iShares IBIT saw its first-ever outflows this week following 71 straight days of inflows.

Mitchnick believes the current lull will be followed by a new wave of buying from deep-pocketed institutional players. As more giants like BlackRock build multi-billion dollar Bitcoin reserves, it validates Bitcoin as an investable asset class.

The ETF conversations also come as BlackRock CEO Larry Fink has softened his once critical stance on Bitcoin.

With iShares IBIT quickly accumulating over $17 billion in Bitcoin, BlackRock has proven the massive latent demand for regulated Bitcoin investment vehicles.

Despite short-term ETF outflows amid volatility, its long-term outlook remains highly optimistic.

As Mitchnick stated, "Many of these interested firms – whether we're talking about pensions, endowments, sovereign wealth funds, insurers, other asset managers, family offices – are having ongoing diligence and research conversations, and we're playing a role from an education perspective."

All in all, such educated, pragmatic institutional interest bodes well for the continued growth of the Bitcoin ETF market.