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In less than nine months since launching its bitcoin exchange-traded fund (ETF) following the approval of such investment vehicles by the US Securities and Exchange Commission (SEC), asset manager BlackRock has established itself as the largest bitcoin fund in the world.
A tale of two titans in the bitcoin and ethereum markets
According to on-chain data from blockchain analytics platform Arkham, BlackRock has aggressively expanded its bitcoin Holdings through its ETF, known as IBIT in recent months.
Despite recent market volatility that saw significant drops in the price of bitcoin on August 5 and September 6, BlackRock continued to purchase more bitcoin, thereby supporting not only the value of the token but also its own asset base.
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As of September 25, BlackRock holdings have reached approximately 358,000 btc, valued at around $22.76 billion, representing around 1.70% of the total bitcoin supply of 21 million.
By comparison, BlackRock's bitcoin holdings exceed those of Grayscale, another major crypto asset manager in the industry, by nearly 100,000 btc. Grayscale currently holds approximately 258,671 btc, valued at $16.45 billion, highlighting the significant gap BlackRock has created in the btc investment landscape.
While BlackRock has taken a commanding lead in bitcoin, Grayscale maintains an advantage in ethereum (eth) in its portfolio. Arkham data indicates that Grayscale holds 2,104 million eth, valued at approximately $5.45 billion at the current trading price of $2,600 per eth. In contrast, BlackRock’s ethereum holdings amount to just 349,970 eth, valued at approximately $910 million.
BlackRock strengthens its stance on bitcoin
BlackRock's support for bitcoin extends beyond mere investment; it includes a strong backing of the technology that underpins the cryptocurrency. In a recent crypto-head-mitchnick-sees-bitcoin-as-risk-off-asset” target=”_blank” rel=”nofollow”>interview In an interview with Bloomberg, Robbie Mitchnick, head of digital assets at BlackRock, challenged the prevailing notion that bitcoin should be classified as a “risky” asset.
During Tuesday's interview, Mitchnick noted that while bitcoin has recently shown a high correlation with U.S. stocks, this relationship can be misleading.
BlackRock's head of digital assets noted that risk assets such as stocks, commodities and high-yield bonds perform well during periods of market optimism and economic growth. In contrast, assets such as gold are sought after in times of uncertainty as they provide a safe haven for investors.
Mitchnick drew parallels between bitcoin and gold, saying that “gold shows a lot of the same patterns,” referring to its temporal correlations with stocks. He emphasized that the long-term correlation between btc and traditional financial assets It's close to zero.
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One of the defining characteristics of btc is its decentralized nature, Mitchnick added. No one country or government controls it, he said, which increases its appeal as a global monetary alternative.
Mitchnick highlighted bitcoin’s scarcity, global reach, and decentralized framework, describing it as a “non-sovereign asset.” He noted that btc has no country-specific risk or counterparty risk, making it an attractive option for investors looking to diversify their portfolios.
At the time of writing, the market’s top cryptocurrency has given back some of the gains made during Tuesday’s trading session, after hitting a one-month high of $64,700. btc is currently trading at $63,220, down slightly by 0.3% over the 24-hour period.
Featured image of DALL-E, chart from TradingView.com
