BlackRock CEO Larry Fink expressed his pleasant surprise at the outstanding performance of the firm’s Bitcoin exchange-traded fund (ETF) and reiterated his strong belief in the long-term potential of Bitcoin.
In an interview with Fox Business on March 27, Fink stated that the iShares Bitcoin Trust (IBIT) is the fastest-growing ETF in history, surpassing all other ETFs in terms of asset accumulation. He admitted that the performance of IBIT has exceeded his expectations during the first 11 weeks of trading.
According to Farside Investors, IBIT gained impressive traction, attracting $13.5 billion in flows within the first 11 weeks. On March 12, it reached a daily high of $849 million. On average, IBIT receives over $260 million in inflows per trading day.
Fink highlighted the positive impact of IBIT on the market, stating that it has enhanced liquidity and transparency. He confessed that the level of retail demand was unpredicted before the ETF was launched.
When asked if he anticipated IBIT to perform well but not to this extent, Fink responded affirmatively, underscoring his bullish outlook on Bitcoin’s long-term viability.
As per BitMEX Research, IBIT currently holds $17.1 billion worth of Bitcoin, achieving the $10 billion milestone in just two months. This milestone took the first gold ETF two years to reach. Among the approved ETFs, IBIT is second only to the Grayscale Bitcoin Trust, which holds $23.6 billion in BTC. However, Grayscale’s Bitcoin holdings have gradually decreased from the 620,000 BTC it owned before transitioning to a spot Bitcoin ETF.
Apart from Grayscale, the nine-spot Bitcoin ETF issuers collectively possess over $34.1 billion in Bitcoin. IBIT, along with the Fidelity Wise Origin Bitcoin Fund (FBTC) and ARK 21Shares Bitcoin ETF (ARKB), leads the inflows in this category.
Despite the success of some spot Bitcoin ETFs, industry experts predict that certain issuers may eventually shut down due to insufficient profits. Hector McNeil, the co-CEO and founder of ETF provider HANetf, believes that most of the current ETFs will not break even unless they accumulate billions in assets under management, which seems unlikely.
To compete with major players, several smaller ETF issuers have reduced their fees. However, these challengers face a difficult battle against the industry giants, according to Bloomberg ETF analyst Henry Jim.
On March 27, asset management firm Hashdex became the 11th entrant to the competitive spot Bitcoin ETF market in the United States after its ETF received approval.
In a related development, Wolf Of All Streets magazine expressed concern about a scenario where Bitcoin reaches $1 million, highlighting the potential consequences.