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BlackRock Says Institutions Bitcoin Adoption is Still Very Early
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Asset manager BlackRock has highlighted a growing interest among institutions and wealth advisors in Bitcoin but insisted it is still in its early stages. Robert Mitchnick, the head of digital assets at the $11.5 trillion asset management firm, said in the Bloomberg ETF IQ interview that wealth advisors are now turning towards Bitcoin. And while this is a positive development, he emphasized that it is still in the early stages, and more institutions will come around soon.
His comments came as the BlackRock iShares Bitcoin Trust (IBIT) nears an impressive $72 billion in net assets. The Bitcoin investment fund experienced pent-up demand between April and May. In May alone, the product attracted a net inflow of $5.91 billion, marking its strongest month since March 2024.
Wealth Advisors Are Coming
Recent 13-F filings with the US SEC for Q1 2025 saw growing exposure from wealth advisors towards Bitcoin spot ETFs. For instance, Goldman Sachs increased its exposure, while new names, such as the Abu Dhabi sovereign wealth fund, Mubadala, also bought more Bitcoin. BlackRock’s Mitchnick acknowledged the growing adoption of the Bitcoin ETF wrapper for new and experienced institutions. However, he stressed that it is very early in terms of wealth advisor adoption.
The approval process for new ETFs takes time, as institutions conduct thorough due diligence on the nature and viability of the fund. Nonetheless, he identified a strong interest among some of the “largest firms,” so much so that some of them are lowering their barriers and approving that their advisors buy Bitcoin.
Possible Drivers for Bitcoin ETFs Surge
Nonetheless, the IBIT has been one of the most successful launches in the history of ETFs. The Bitcoin investment product became the fastest to reach a net asset under management of $50 billion and is now well above $71 billion. When asked the possible drivers for this stunning growth, Mitchnick highlighted a congregation of several bullish catalysts. He stated that pent-up demand for the vehicles, which tracks Bitcoin’s performance, initially started with retail investors.
Soon enough, high-net-worth individuals began gaining exposure. Recall that several billionaires, including Ricardo Salinas Pliego, have staggering amounts of their portfolio in Bitcoin and Bitcoin-related products. Meanwhile, it remains unclear if the Mexican billionaire holds IBIT shares. Now, Mitchnick has revealed steady progress in institutional adoption. According to him, the massive demand has fueled these incessant inflows into the funds.
Bitcoin is Volatile Yet Appealing
Meanwhile, Mitchnick acknowledged a reduction in Bitcoin’s volatility. While stating that Bitcoin, on a standalone basis, is a volatile asset, citing its relatively novel technology, he noted that the asset offers a unique appeal to investors.
“It is still volatile, but at the same time, its risk and return drivers are markedly different from most of the rest of the assets in a traditional portfolio, and that’s important,” Mitchnick emphasized. For the uninitiated, Bitcoin is one of the best-performing assets of the last decade, demonstrating a level of consistency in rewarding its adopters. The pioneering cryptocurrency rallied 121% last year and is up 15% year-to-date.
At the time of writing, it trades at $109,608, representing a 3.78% increase in the past 24 hours. Notably, Mitchnick also discussed BlackRock’s Ethereum spot ETF, which he disclosed is currently strongly driven by retail investor attraction. He noted that, although there is an exciting story surrounding Ethereum, as seen with Bitcoin, it focuses more on technological innovation and blockchain adoption.
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