Bitcoin ETF Growth: BlackRock’s New Model Portfolio Move

Bitcoin ETFs Gain Traction as BlackRock Adds IBIT to Model Portfolios

Bitcoin ETF– BlackRock, the world’s largest asset manager, is expanding its offerings by including iShares Bitcoin Trust (IBIT) in its model portfolios. This move was confirmed to Decrypt on Friday. The addition comes as part of BlackRock’s Target Allocation with Alternatives portfolios, which cater to investors with higher risk tolerance. These portfolios will now include 1% to 2% of IBIT, as a way to diversify and reflect growing demand for cryptocurrency exposure.

The inclusion of IBIT in BlackRock’s model portfolios reflects a significant shift in traditional finance’s acceptance of crypto assets. A BlackRock spokesperson shared that the addition aligns with the investment objectives of these portfolios, which are designed to provide exposure to stocks, bonds, and liquid alternative investments. “The addition of IBIT as a diversifier is in line with the model’s focus on higher risk budgets and growth targets,” the spokesperson explained.

Despite being a relatively small part of the Target Allocation with Alternatives portfolios, this addition could trigger increased demand for IBIT, especially considering its impressive performance so far. Since its launch in January 2024, IBIT quickly reached $60 million in assets under management, surpassing the speed of all other ETFs in the industry’s 32-year history.

Impact on the Bitcoin Market and Future Prospects

While BlackRock’s decision is likely to further bolster IBIT’s performance, the fund has seen a drop in assets recently due to the downturn in the broader crypto market. Despite this, IBIT still holds a larger share of assets compared to its competitors in the Bitcoin ETF space.

ETF.com analyst Sumit Roy noted, “This move could boost demand for the fund further,” but cautioned that any influx from this change may not be substantial in the immediate term.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Cryptocurrencies and stocks, particularly in micro-cap companies, are subject to significant volatility and risk. Please conduct thorough research before making any investment decisions.