The Impact of BlackRock Crypto ETF Forecast on Crypto Market
According to Robert Mitchnick, head of BlackRock’s digital assets, the asset manager sees “very little interest” from clients in cryptocurrency outside of Bitcoin and Ethereum and doesn’t anticipate many crypto ETFs outside of those two fundamental digital assets. Mitchnick made these remarks on July 25 at the Bitcoin 2024 conference in Nashville, TN.
I would say that our client base today, their interest overwhelmingly is in Bitcoin first, and then somewhat in ETH… and there’s very little interest today beyond those two. I don’t think we’re gonna see a long list of crypto ETFs,
Mitchnick
Not every asset manager is in agreement. A Solana product is among the cryptocurrency ETFs that Franklin Templeton, which already issues BTC and ETH ETFs, is hopeful about releasing in the future.
Besides Bitcoin and Ethereum, there are other exciting and major developments that we believe will drive the crypto space forward,
BlackRock: ETH and BTC Investments Complement Each Other
According to Mitchnick, the majority of Blackrock‘s clients view ETH and BTC as allies rather than rivals. According to Mitchnick, when investors purchase ETH ETFs, they typically increase the amount of cryptocurrency in their portfolio rather than take out BTC. The data on investor flows into ETH ETFs, which only began trading on July 23, is scarce, he said.
The whole store of value use case within crypto is pretty definitively territory that Bitcoin owns. ETH is trying to do a bunch of different applications that for the most part, Bitcoin is not trying to do. So, really, they’re more compliments than they are competitors or substitutes.
Mitchnick
According to Mitchnick, investors will eventually allocate about 20% of their cryptocurrency holdings to ETH and the remaining portion to BTC.
FAQ
Why does BlackRock expect Interest Only in Bitcoin and Ethereum ETFs?
BlackRock believes that Bitcoin and Ethereum have much higher market capitalization and acceptance rates than other cryptocurrencies. Therefore, it predicts that investor interest will largely focus on these two cryptocurrencies.
Why aren’t Other Cryptocurrency ETFs Gaining Traction?
Factors such as the volatility, market acceptance, and liquidity issues of other cryptocurrencies cause investor interest to be low. For these reasons, BlackRock thinks that ETFs other than Bitcoin and Ethereum will attract less interest.
What is BlackRock’s Cryptocurrency Strategy?
BlackRock aims to gain the trust of investors by focusing on Bitcoin and Ethereum, the leaders in the cryptocurrency market. This strategy favors safe and well-known assets to appeal to a wider investor base.
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