Why Is BlackRock’s IBIT Bitcoin ETF Soaring?

After missing a couple of beats in late May and early June, BlackRock’s iShares Bitcoin exchange-traded fund (IBIT) returned to its previous searing form last week, totaling about $1.1 billion in net investments.

The fund has been one of the great investment success stories, cracking $70 billion in assets under management in just 341 days, faster than any of the thousands of funds in the ETF industry’s 32-year history. IBIT’s popularity reflects not only of the $11.6 trillion asset management giant’s brand strength but also the growing embrace by once crypto shy investment advisors and other institutions.

“The fact that you have advisors and institutions adopting it (crypto ETFs) this quickly is a good sign,” Bloomberg Senior ETF Analyst Eric Balchunas told Decrypt. “These are bigger fish that don’t bite quickly. Usually, it takes years for them to get interested in an ETF, because it means liquidity. These are some of the hardest investors to attract.”

Balchunas added: “Advisors and institutions, they’re just more sophisticated.”

A Bloomberg Intelligence report earlier this month found that investment advisors filing 13-F reports to the U.S. Securities and Exchange Commission hold about 20% of the spot Bitcoin ETF shares–roughly $21 billion of the asset—and Balchunas says the percentage is likely to double in the next year. Advisor’ holdings in the asset, which have grown dramatically, rank number one “by a mile,” with hedge fund managers and brokerages falling in behind, Balchunas noted in a June 9 X post.

Balchunas said that roughly 1,200 13-F filers held IBIT shares. “That’s insane,” he told Decrypt.

The growth has come as the Trump administration has loosened regulation and introduced more crypto friendly policies, sparking sizable price gains in BTC and major altcoins. Bitcoin was recently trading near $105,000, a 12% gain year-to-date that has far outstripped equity indexes and most other risk-on assets–a reality not lost on investors whose appetite for digital assets and products based on them has mushroomed.

Financial advisor interest in crypto ETFs, as a result, has heated up. A study of financial advisors released in January by crypto-focused asset manager Bitwise and financial services data provider VettaFi found that nearly one in five advisors were planning to allocate crypto to investor accounts in 2025, double the percentage in the previous year, and that nearly all of the 400 advisors surveyed said they had received a question about crypto over that period.

Ric Edelman, a long-time financial advisor and founder of the Digital Assets Council of Financial Professionals, a trade group, told Decrypt that the friendlier political environment for digital assets and advisors’ determination to learn more about them are behind the trend.

“You can’t recommend something you don’t know anything about,” Edelman said. “Advisors are racing to increase their knowledge so they can provide reasonable advice to the client that’s in the client’s best interest. Simultaneously, firms recognize that this is a huge opportunity to increase their AUM, because clients are going to buy Bitcoin—and if they’re not going to be able to buy it from the firm, they’re going to go buy it somewhere else.”

At a conference last week, Edelman called for advisors to allot a minimum of 10% in digital assets for cautious portfolios and as much as 40% for more enterprising accounts, a departure from traditional 60-40 splits in stocks and bonds, and an increase from his previous recommendation that investors should allocate single digits to crypto.

“The allocation model you’re familiar with—stocks and bonds—must now be replaced by one featuring stocks, crypto, and bonds,” Edelman told an audience of independent financial advisors at the VISION event in Arlington, Texas.

Edelman told Decrypt that IBIT’s ranking for AUM well atop the other 10 funds in the spot Bitcoin category stems from brand recognition.

“When institutional investors engage for the first time, it is the path of least resistance for approval by the board and the C-suite,” he said. “If you’re going to engage in an investment in a new asset class that most have limited experience or knowledge about, you can diffuse some of the concerns by choosing one of the best known brands, and that’s BlackRock. BlackRock is the beneficiary of its brand.”

ETF.com Senior Analyst Sumit Roy also expects the momentum of crypto funds to grow as investors seek exposure to digital assets without the risk and responsibility of holding them directly.

“More adventurous investors have been able to get exposure through crypto trading platforms like Coinbase and OTC vehicles like GBTC (prior to its ETF conversion) for a long time,” Roy said. “Advisors and institutions have been much slower to adopt crypto given the risks and lack of regulatory protections.”

“Now with regulated ETFs,” he added, “those professionals are entering the space and I’d expect them to continue to march slowly into these funds.”

Edited by Andrew Hayward