BlackRock advises pension and sovereign wealth funds on investing in BTC ETFs

What’s new? BlackRock, the world’s largest investment firm with $10,5 trillion in assets under management, is involved in informing various asset managers about the spot bitcoin exchange-traded funds (ETFs) launched in the United States on January 11 to entice them to invest in these new products.

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What else is known? BlackRock is the issuer of the IBIT spot bitcoin fund with $15,85 billion in assets under management. Total inflows into the product since launch totaled $15,44 billion. On April 24, IBIT entered the top 10 best ETFs of all time, surpassing JETS, BND, and VEA, as it maintained inflows for 71 days.

Thereafter, inflows into IBIT slowed and then went into negative territory. On May 1, outflows from the fund totaled $36,93 million.

However, Robert Mitchnick, BlackRock’s head of digital assets, expects that this lull will be followed by a new inflow of funds coming from a new type of investors, such as pension, charitable, and sovereign wealth funds, as well as insurance companies, which BlackRock is currently informing. He predicts a resumption of inflows in the coming months.

The senior executive also noted a renewed discussion around bitcoin among institutional investors, with institutions exploring ways to add the asset to their portfolios.

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Among the ten new spot bitcoin funds, IBIT is the leader in terms of inflows. The largest in terms of assets remains GBTC from Grayscale, which until January operated as a bitcoin trust without the possibility of redeeming shares. After conversion, it faced outflows due to high management fees, which are still ongoing and have already approached $17,5 billion.

Earlier, analysts at broker Bernstein called the slowdown in BTC-ETF inflows a “short-term pause” that will end once such products are more closely integrated with institutional platforms. Morgan Creek Capital head of venture capital Mark Yusko said hundreds of billions of dollars from pension funds will flow into BTC ETFs over the year.

VanEck also noted the growing interest in the product from institutional investors, who have already accumulated $175 billion worth of bitcoins in their accounts.

Earlier, the media reported that Morgan Stanley may allow its 15 000 brokers to recommend clients to buy shares of spot BTC ETFs.