BlackRock Adds Bitcoin ETF to Financial Advisor Portfolios, Potentially Boosting Demand

BlackRock is taking a new step in expanding Bitcoin exposure by incorporating its spot Bitcoin ETF into select investment portfolios aimed at financial advisors.

According to Bloomberg, the asset management giant is planning to allocate a small portion—between 1% and 2%—of these portfolios to the iShares Bitcoin Trust (IBIT).

This decision comes at a time when Bitcoin’s price has been struggling, leading to fluctuating demand for spot Bitcoin ETFs. Recently, IBIT experienced a sharp decline in investor inflows, recording $418.1 million in net outflows on Wednesday—the largest single-day withdrawal to date. Despite this, BlackRock’s ETF remains the dominant player in the market, with more than $48 billion in assets under management, far surpassing Fidelity’s Bitcoin ETF, which holds around $23 billion.

The ongoing volatility in Bitcoin markets has influenced ETF trading activity, with February shaping up to be one of the worst months for the cryptocurrency in recent years. Bitcoin’s price has faced a significant downturn, and some analysts predict further declines. Standard Chartered’s Geoffrey Kendrick expects the cryptocurrency to trade within the $69,000 to $76,500 range in the short term.

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While IBIT has already established itself as a market leader, BlackRock’s decision to integrate it into pre-structured investment portfolios could drive additional demand. These model portfolios, designed for financial advisors, combine various assets into ready-made investment strategies. Adjustments to their holdings can result in large capital movements, potentially boosting IBIT’s position and influencing Bitcoin’s overall market performance.

Kosta Gushterov