Bitcoin ETFs To See New Wave Of Inflows From Sovereign Wealth Funds, Pensions, BlackRock Says

Updated: 03 May 2024

Disclosure

Don’t invest unless prepared to lose all the money you invest. This is a high-risk investment, you shouldn’t expect to be protected if something goes wrong.

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Sovereign wealth funds, pension funds, and endowments are likely to unleash a new wave of capital into Bitcoin ETFs in coming months, said fund management titan BlackRock.

These money management giants are “having ongoing diligence and research conversations” regarding spot Bitcoin ETFs, BlackRock‘s head of digital assets Robert Mitchnick told CoinDesk in an interview.

Wall Street Firms Consider Solicited Offering Of Bitcoin ETFs

Demand for spot Bitcoin ETFs has led to more than $75 billion in assets across the new investment products since their launch in January.

A small number of investment advisors are already offering BlackRock’s IBIT ETF on an unsolicited basis to clients. But Wall Street giant Morgan Stanley is now reportedly considering expanding its sale of the investment products by giving its 15,000 brokers the ability to solicit customer purchases of Bitcoin ETFs.

Up until now, investors had to explicitly ask their financial advisors about spot Bitcoin ETFs in order to invest in the funds. If advisors are able to solicit purchases, it could lead to a new wave of capital entering the products.

Inflow Streak Ending Is No Cause For Concern, BlackRock Says

Regardless of the restrictions currently imposed on advisors, the nascent spot Bitcoin ETF industry in the US experienced a strong start after posting 71 consecutive days of inflows. This streak came to an end at the start of May after hopes the Fed would cut interest rates were crushed.

So, iShares Bitcoin ETF has first day of outflows ($37mil)…

Has taken in $15+bil ytd.

For perspective, iShares Gold ETF has $1bil *outflows* this yr.

SPDR Gold ETF has $3bil outflows.

And gold is up 16% ytd.

This is what ETFs do. Inflows don’t go up in straight line.

— Nate Geraci (@NateGeraci) May 2, 2024

Mitchnick remains bullish towards spot Bitcoin ETFs, since BlackRock is seeing a “re-initiation of the discussion around bitcoin,” he said in the interview. Central topics of these discussions relate to how institutions can allocate capital towards BTC and how portfolios can be constructed to include the crypto.

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