In less than nine months since the launch of its Bitcoin exchange-traded fund (ETF) following the approval of these investment vehicles by the US Securities and Exchange Commission (SEC), asset manager BlackRock has established itself as the world’s largest Bitcoin fund.
A Tale Of Two Titans In Bitcoin And Ethereum Holdings
According to on-chain data from blockchain analysis platform Arkham, BlackRock has aggressively expanded its Bitcoin holdings through its ETF, known as IBIT over the last months.
Despite recent market volatility that saw significant dips in Bitcoin’s price on August 5 and September 6, BlackRock continued to buy more Bitcoin, thereby supporting not only the token’s value but also its own asset base.
As of September 25, BlackRock’s have reached approximately 358,000 BTC, valued at around $22.76 billion, representing about 1.70% of Bitcoin’s total supply of 21 million.
In comparison, BlackRock’s Bitcoin holdings exceed those of Grayscale, another major crypto asset manager in the industry, by nearly 100,000 BTC. Grayscale currently approximately 258,671 BTC, valued at $16.45 billion, highlighting the significant gap that BlackRock has created in the BTC investment landscape.
While BlackRock has taken a commanding lead in Bitcoin, Grayscale maintains an advantage in Ethereum (ETH) holdings. Arkham’s data indicates that Grayscale possesses 2.104 million ETH, valued at roughly $5.45 billion based on the current trading price of $2,600 per ETH. In contrast, BlackRock’s Ethereum holdings amount to only 349,970 ETH, valued at approximately $910 million.
BlackRock Strengthens Bitcoin Stance
BlackRock’s support for Bitcoin extends beyond mere investment; it includes a strong endorsement of the technology underpinning the cryptocurrency. In a recent with Bloomberg, Robbie Mitchnick, head of digital assets at BlackRock, challenged the prevailing notion that Bitcoin should be categorized as a “risk-on” asset.
During Tuesday’s interview, Mitchnick noted that while Bitcoin has recently shown a high correlation with US equities, this relationship may be misleading.
The head of digital assets at BlackRock noted that risk-on assets, such as stocks, commodities, and high-yield bonds, perform well during periods of market optimism and economic growth. Conversely, assets like gold are sought after in times of uncertainty, providing a safe haven for investors.
Mitchnick drew parallels between Bitcoin and gold, saying “gold shows a lot of the same patterns”, referring to their temporary correlations with equities. He emphasized that the long-term correlation between BTC and traditional financial assets is close to zero.
One of BTC’s defining characteristics is its decentralized nature, Mitchnick added. No single country or government controls it, he said, which adds to its appeal as a global monetary alternative.
Mitchnick went on to highlight Bitcoin’s scarcity, global reach and decentralized framework, describing it as a “non-sovereign asset”. He pointed out that BTC has no specific country risk and no counterparty risk, making it a compelling option for investors looking to diversify their portfolios.
At the time of writing, the largest cryptocurrency on the market has given back some of the gains made during Tuesday’s trading session, after hitting a one-month high of $64,700. Currently, BTC is trading at $63,220, down a slight 0.3% over the 24-hour period.
Featured image from DALL-E, chart from TradingView.com