BlackRock: Bitcoin ETF drew many first-time ETF investors

Jay Jacobs, BlackRock’s U.S. head of equity ETFs, said on a podcast Thursday that about 75% of investors in the iShares Bitcoin Trust had never owned an ETF before and that many of those investors went on to buy other BlackRock funds.

The iShares Bitcoin Trust, launched in January 2024, manages roughly $48 billion and holds about 765,936 BTC, figures Jacobs cited. After acquiring Bitcoin exposure through the trust, a significant number of investors subsequently purchased funds such as the S&P 500 ETF (IVV), an artificial intelligence ETF (BAI) and a gold ETF (IAU).

BlackRock introduced the iShares Bitcoin Premium Income ETF (BITA) this week. The fund is structured to generate income by selling covered call options on Bitcoin holdings, offering an alternative exposure to the cryptocurrency with an income component.

Jacobs used the term “Great Convergence” to describe a growing overlap between traditional finance and decentralized finance, saying investors are combining different asset types and strategies within single portfolios rather than keeping them separate.

He described IBIT as “a way for traditional investors to now get into digital assets” and noted that some investors enter the crypto product ecosystem through digital-asset exchange-traded products before moving into conventional ETFs.

Market activity tied to private and pre-IPO opportunities in crypto has increased. Trading in pre-IPO perpetual futures rose from about $1 billion in early May to roughly $22 billion in recent weeks, and major crypto trading platforms have developed venues for those products.

BlackRock now offers multiple vehicles for Bitcoin exposure, including spot exposure and an income-focused ETF, designed to match different investor preferences for risk, return and yield within the crypto sector.