BlackRock Expands Bitcoin Exposure by Adding Its Bitcoin ETF (IBIT) into Its Portfolio Strategies

Bloomberg reported Friday that BlackRock, the world's largest asset issuer with $11.5 trillion under management, has expanded its crypto exposure by adding its BlackRock's iShares Bitcoin Trust (IBIT)

BlackRock has expanded its crypto exposure by including its BlackRock’s iShares Bitcoin Trust (IBIT) (NYSE: IBIT) in its portfolio strategies that allow alternative investments, Bloomberg reported Friday, citing internal documents.

What Happened: The world’s largest asset issuer, which manages $11.5 trillion in assets, has allocated 1% and 2% of the Bitcoin ETF to the Target Allocation model portfolios, allowing Wall Street traders to explore the fund.

The investment firm’s model portfolios are ready-made investment strategies used by financial advisors to advise clients on their investment decisions.

The small allocation of the Bitcoin ETF is part of a broader strategy by BlackRock to provide its clients with access to a wider range of investment products and strategies.

The report further stated that the inclusion of the IBIT fund in BlackRock’s model portfolio is in response to the demand from financial advisors for exposure to digital assets.

Eve Cout, head of portfolio design and solutions for US Wealth at BlackRock, was quoted as saying that advisors are "constantly seeking exposure" to new asset classes and investment trends.

“We know that advisors are interested in expanding their investment horizons to include new asset classes and investment trends, such as environmental, social and governance investing, and they are looking for ways to integrate these exposures into their model portfolio recommendations,” Cout said.

The IBIT fund, which was one of the first Bitcoin ETFs to be approved by the U.S. Securities and Exchange Commission (SEC) earlier this year, has quickly become popular among institutional investors.

The fund, which is listed on the New York Stock Exchange, is designed to provide investors with a simple and transparent way to gain exposure to the price of Bitcoin.

Also Read: Is Bitcoin Surging Again? Here’s What’s Moving BTC Price Today

It is also fully backed by Bitcoin, which means that each share of the ETF is backed by 0.0001 Bitcoin.

The IBIT fund is part of BlackRock’s broader push into the digital asset market. In January, BlackRock applied to launch an ether futures ETF.

Earlier this year, the firm also announced that it would be investing $750 million in blockchain startup Circle.

What’s Next: The move by BlackRock to include its Bitcoin ETF in model portfolios comes as the crypto ETF market is coming under pressure from heavy outflows amid market volatility.

According to SoSoValue data, Bitcoin ETFs have seen a collective $3.2 billion in outflows over eight days last week, with only four days of net inflows this month.

This brings the total to a monthly net outflow of $3.65 billion, with Tuesday, March 20, seeing a record outflow day for spot Bitcoin ETFs at $1.14 billion.

IBIT specifically saw its biggest single-day outflow on Wednesday at $418 million, but the latest outflow of $275.8 million on Thursday was more moderate.