A marquee at the front entrance of the BlackRock headquarters building in Manhattan.
Eric McGregor | Light Rocket | Getty Images
SALT LAKE CITY — One year ago, Samara Cohen Bitcoin She says she and her team at BlackRock have launched one of the first-ever spot Bitcoin exchange-traded products in the United States. Investors are now pouring in, many of them crypto enthusiasts joining Wall Street for the first time.
Cohen, who oversees the asset manager’s exchange-traded funds and index investments as chief investment officer, told CNBC that BlackRock now recognizes that demand is for better ways to access Bitcoin. spoke. “It was for the ETF wrapper,” she told CNBC on stage at the Permissionless conference in Utah.
The market cap of all 11 Spot Bitcoin ETFs is now over $63 billion, with total flows of nearly $20 billion. In the past five business days alone, the Spot Bitcoin ETF has seen more than $2.1 billion in net inflows, with BlackRock accounting for half of its sales.
The surge in trading volume comes after Bitcoin hit its highest price since July this week, trading above $68,300. As the market capitalization of these spot token funds and cryptocurrencies rose in tandem, Bitcoin ended the third quarter up about 140% year-over-year, outperforming the S&P 500. Stocks linked to virtual currencies coinbase The stock rose about 24% this week, its best week since February.
Cohen told CNBC that part of his strategy to attract customers to his funds included educating crypto investors about the benefits of exchange-traded products (ETPs).
13F filings, which provide quarterly information on stock positions held by large investors, show that 80% of buyers of these new spot Bitcoin products in the US are direct investors. Cohen told CNBC that of the 80% of direct investors, 75% have never owned iShare, one of the most well-known and largest ETF providers on the planet.
“So we embarked on this effort with the expectation that we needed to educate ETF investors specifically about cryptocurrencies and Bitcoin,” Cohen said. “At the end of the day, we have done a lot of educating crypto investors about the benefits of ETP wrappers.”
Before the U.S. Securities and Exchange Commission gave the green light to spot Bitcoin funds in January, investors had several ways to buy and store cryptocurrencies. Centralized exchanges like coinbase It was one of the easiest options for US investors. But Bitcoin ETP’s blockbuster debut exposed Cohen and others on Wall Street that crypto exchanges don’t offer everything digital asset investors need.
It helps that the US is a huge market for digital assets. new Chainalysis data shows that North America remains the world’s largest crypto market, accounting for nearly 23% of all crypto trading volume. The blockchain analytics platform estimates that there was $1.3 trillion in on-chain value received between July 2023 and July 2024.
Venture firm a16z revealed in its recently released State of Crypto report that more than 40 million Americans own cryptocurrencies.
So far, adoption has primarily been driven by wealth management clients asking their advisors to add new spot crypto products to their portfolios.
In August, Morgan Stanley became the first major bank to allow its 15,000 financial advisors to sell BlackRock and Fidelity Bitcoin ETFs to clients with net worth of more than $1.5 million. Some companies still perform internal due diligence before FA forces begin aggressively marketing funds.
“The allocators at the asset management company are not making the allocations,” Van Eck CEO Jan van Eck told CNBC in Utah. “I mean, we haven’t even warmed up yet.”
Van Eck drew parallels with the European market, where the company trades 12 token-based products in Europe.
“That’s exactly what you see in Europe,” he said. “There are very few private banks that actually approve Bitcoin or investments in Bitcoin. Ethereum Van Eck said his company has about $2 billion in the European cryptocurrency ETP, much of it from retail investors.
Before Wall Street becomes more comfortable with cryptocurrencies, we need rules from lawmakers on Capitol Hill.
ETFs create transparency
Cohen believes that in many ways ETFs and blockchain technology solve similar problems.
“ETFs are a decentralizing force in the TradFi market, bringing more access and transparency, and importantly, growth really accelerated in 2008-2009 post-crisis,” Cohen said. I talked about financial markets.
“It is very meaningful to see the Bitcoin white paper published on October 31, 2008, and the fact that G20 leaders from around the world have since come together to discuss the aftermath of the financial crisis and how to increase transparency. “Through public reporting,” Cohen continued.
BlackRock reduced risk by using counterparty clearing and multilateral trading. In the TradFi market, these developments have provided a major tailwind for ETFs.
“And at the same time, DeFi has been becoming a reality over the last 15 years,” she said.
“Was this a win for Bitcoin? Was this a win for ETPs? The answer for me is that it effectively combines these ecosystems that are working towards the same goal. As much as possible, it’s a win for investors.”
