Bitcoin Investors Withdraw $331M from BlackRock’s Bitcoin ETF

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# BlackRock Sees Limited Demand for Ethereum Among Clients Robert Mitchnick, BlackRock's Head of Digital Assets, recently shared insights into the asset management giant's stance on cryptocurrency offerings, emphasizing a strong client preference for Bitcoin over Ethereum. During a fireside chat at the Bitcoin Investor Day conference in New York, Mitchnick highlighted the comparative lack of interest in Ethereum and other cryptocurrencies among BlackRock clients. ## Bitcoin Dominates Client Interest Mitchnick noted that Bitcoin is the primary focus of interest for BlackRock's clientele, with Ethereum garnering only a modest level of attention. This observation underscores the prevailing market trend where Bitcoin continues to be viewed as the leading digital asset. For cryptocurrencies beyond Bitcoin and Ethereum, Mitchnick pointed out that the demand from BlackRock's client base is minimal. ## Misconception About BlackRock's Crypto Services Addressing the speculation about BlackRock launching a range of crypto-related services, including an exchange-traded fund (ETF) for the meme-inspired cryptocurrency dogwifhat (WIF), Mitchnick clarified that the company is not looking to expand its offerings into a wide array of crypto assets. He underscored that BlackRock's primary focus does not involve diversifying into numerous other crypto services. ## BlackRock's Bitcoin ETF Attracts Significant Interest The discussion also touched upon BlackRock's recent foray into the digital assets market with the launch of the Bitcoin Bitcoin Fund (IBIT). The ETF quickly became one of the top-performing funds in the market, drawing $15 billion in assets and significantly outperforming other funds launched in the same period. Mitchnick attributed this success to the enduring interest and demand from clients for Bitcoin exposure, which had remained strong through various market conditions. ## Tokenized Asset Fund on Ethereum Network Despite the limited client interest in Ethereum, BlackRock has made moves on the Ethereum network, unveiling the tokenized asset fund BUIDL. This initiative, in collaboration with Securitize, showcases BlackRock's exploration of blockchain technology for asset tokenization, highlighting a cautious yet strategic approach to incorporating digital assets into their portfolio offerings. In summary, while BlackRock recognizes the potential of cryptocurrencies like Ethereum, its digital asset strategy remains heavily weighted towards Bitcoin, reflecting client preferences and market dynamics. The company's cautious expansion into the digital asset space indicates a focused approach, prioritizing demand and exploring innovative solutions within a select range of cryptocurrencies.

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BlackRock’s iShares Bitcoin Trust (IBIT) experienced its largest single-day outflow since its launch, as trading in the United States resumed on January 2.

Largest Outflow in IBIT’s History

On January 2, BlackRock’s spot Bitcoin exchange-traded fund (ETF) saw a record $330.8 million withdrawn, equivalent to more than 3,500 Bitcoin. This figure, shared by Thomas Fahrer, CEO of the crypto-focused reviews portal Apollo, represents the largest outflow since the fund began operations in January 2024. The previous record stood at $188.7 million, set on December 24.

The withdrawal marks the third consecutive trading day of outflows for the ETF, another historic trend. Over the past week alone, the iShares Bitcoin Trust has recorded total outflows of $391 million.

Broader Context for Bitcoin ETF Flows

Despite the recent pullbacks, BlackRock’s fund performed well throughout 2024, ranking third among all ETFs in the United States in terms of inflows. According to Bloomberg data shared by senior ETF analyst Eric Balchunas, the fund attracted $37.2 billion in inflows last year.

For comparison, the Vanguard 500 Index Fund (VOO) and iShares Core S&P 500 ETF (IVV) took the top two spots with $116 billion and $89 billion in inflows, respectively. This strong performance has led some experts, including Bitcoin pioneer Adam Back, to speculate that Bitcoin ETFs may take the lead in 2025 due to higher inflows and rising cryptocurrency prices.

While BlackRock experienced significant outflows, other Bitcoin ETF providers saw a contrasting trend. Bitwise, Fidelity, and Ark 21Shares reported inflows of $48.3 million, $36.2 million, and $16.5 million, respectively, on January 2. Grayscale’s Bitcoin Mini Trust also recorded minor inflows of $6.9 million, though its flagship GBTC fund saw $23 million in outflows.

Predictions for Crypto ETFs in 2025

Nate Geraci, president of the ETF Store, shared his outlook for crypto ETFs in 2025. He predicted the launch of combined spot Bitcoin and Ether ETFs, along with spot Ether ETF options trading. Other potential developments include spot BTC and ETH ETFs offering in-kind creation and redemption, staking options for Ether funds, and the approval of a spot Solana ETF. Geraci expressed confidence that these milestones are achievable in the near future.

While BlackRock’s iShares Bitcoin Trust faces short-term challenges with record outflows, the broader crypto ETF market remains dynamic. Competing products and optimistic predictions for 2025 suggest that the sector may continue to grow and evolve, driven by innovation and increased investor interest.

Adam L
Adam L
In the world of blockchain and cryptocurrencies, I have a great deal of passion and interest. My interest in blockchain and cryptocurrencies has led me to explore these technologies in greater depth, as I am interested in the potential implications they could have on the global economy.

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