TL;DR
- BlackRock reaffirms that Bitcoin is an effective hedge against geopolitical uncertainty and monetary risks.
- BlackRock’s BTC ETF has been the most profitable since its launch in January 2024, significantly surpassing Grayscale.
- Despite the decline in demand and the drop in BTC price, interest in cryptocurrencies remains strong and is expected to continue growing.
BlackRock has reaffirmed the value of Bitcoin as an effective hedge against geopolitical uncertainty and monetary risks, according to Jay Jacobs, head of Thematic and Active ETFs at the company, in the first edition of BlackRock’s Quick Download series. Jacobs noted that the digital assets industry is expanding rapidly and that investors have shown great interest in BlackRock’s IBIT BTC ETF since its launch.
Jacobs explained that Bitcoin, as a nascent asset, represents only one-tenth the size of the gold market, contributing to its high volatility and its different behavior compared to traditional stocks and bonds. This particular set of characteristics makes it an attractive option for those investors seeking potential protection against geopolitical and monetary risks, as well as for those who see a promising future for blockchain technology. However, he cautioned that it is crucial for investors to approach their moves with BTC carefully, considering both the risks and the potential returns of the asset.
Great chat with @Samaraepcohenon on the first edition of the Quick Download, diving into all things digital assets, including our IBIT Bitcoin ETP.
Since IBIT's launch, we've seen strong interest from both new and long-time digital asset investors. The key theme? Convenience. pic.twitter.com/vyuNgqEoZq— Jay Jacobs (@JayJacobsCFA) June 27, 2024
BlackRock Knows Bitcoin is the Future
Since the launch of Bitcoin ETFs in January 2024, the cryptocurrency’s price has seen a strong increase, reaching an all-time high of $73,000 in March. BlackRock’s BTC ETF has been the most profitable, surpassing Grayscale in terms of inflow at the end of May. This achievement is notable, as Grayscale had converted its BTC trust, present on the OTC market since 2015, into an ETF.
Despite the initial success, inflows into Bitcoin ETFs have gradually begun to decline, possibly indicating a shift in trends. The decrease in demand has caused BTC’s price to fall, currently hovering around $61,000. BlackRock and other asset management firms have now turned their attention to Ethereum, expecting their ETFs to receive approval next week.
However, despite the volatility, interest in BTC and other cryptocurrencies remains strong, as many investors consider them the future of everyday finance. The constant and growing search for alternatives to the dollar and new investment opportunities fuels this industry every day. BlackRock foresees that this interest will continue to increase, thereby strengthening its presence in the crypto industry.
