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BlackRock’s Bitcoin ETF Hits $2 Billion AUM in Just Two Weeks

Bitcoin BlackRock's Bitcoin exchange-traded fund (ETF) has rapidly surged to $2 billion in assets under management (AUM) on January 26, just a fortnight after its debut on the Nasdaq. The impressive performance can be attributed to recent inflows and a rebound in Bitcoin's price, which reached $42,000 for the first time in almost seven days
 

BlackRock's Bitcoin ETF Hits $2 Billion AUM in Just Two Weeks
BlackRock’s Bitcoin exchange-traded fund (ETF) has rapidly surged to $2 billion in assets under management (AUM) on January 26, just a fortnight after its debut on the Nasdaq. The impressive performance can be attributed to recent inflows and a rebound in Bitcoin’s price, which reached $42,000 for the first time in almost seven days, following a temporary dip after the ETF launch on January 11.

Bloomberg analyst James Seyffart reveals that the intraday price movement of Bitcoin, currently at $41,973, has propelled the fund’s market capitalization to $2.11 billion. This places BlackRock’s iShares Bitcoin Trust (IBIT) at the forefront of the competition for investor capital, slightly ahead of Fidelity’s Wise Origin Bitcoin Fund (FBTC), which recorded $1.8 billion in flows over the preceding ten days.

Leveraging its global reputation as the largest asset manager, BlackRock has successfully attracted a diverse audience to its crypto product. In contrast to some asset managers targeting the crypto community, BlackRock opted for a more mainstream approach. A two-minute video featuring one of its executives was designed to engage baby boomers, outlining Bitcoin’s value proposition and how investors can gain exposure to the new ETF.

One contributing factor to BlackRock’s success may be its competitive fee structure. The initial fee for the iShares ETF is set at 0.12% for the first 12 months or until AUM reaches $5 billion, after which it will increase to 0.25%. This fee strategy, along with its strategic communication approach, has positioned BlackRock as a frontrunner in the Bitcoin ETF race.

Other issuers, such as ARK Invest (0.21%), VanEck (0.25%), and Bitwise (0.20%), also offer competitive fees. It’s essential to note that these fees are not directly billed to investors but are deducted from the ETF’s performance, impacting overall investor returns.

Looking ahead, Seyffart predicts that Bitcoin ETFs, including BlackRock’s, will amass a substantial $10 billion in capital over the first year, reflecting the growing demand for cryptocurrency investment vehicles in the market.

Wasif Shakir

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