BlackRock’s iShares Bitcoin Trust has broken all records and turned out to be the most successful ETF ever launched, with an AuM of $50 billion within 11 months. The ETF was launched on 11th January 2024 and has outperformed all other 1,400 ETFs launched by BlackRock, securing its position as a game-changing financial product.
“The greatest launch in ETF history,” said Nate Geraci, president of The ETF Store, referring to it, and analysts shared his view. According to a Bloomberg report, the meteoric rise of IBIT outpaces any ETF in any asset class.
IBIT’s Growth Outpaces European ETFs By Decades
Todd Sohn, a managing director at Strategas Securities, said the fund’s AuM equals the combined total of more than 50 European market-focused ETFs, some launched more than two decades ago.
“The growth of IBIT is unprecedented,” said James Seyffart, an analyst at Bloomberg Intelligence. It’s the fastest ETF to reach significant milestones.” If the fund keeps this pace up, it will pull in $112 million of revenue annually, according to Seyffart, who based his prediction on its 0.25% expense ratio and current asset level.
That means IBIT’s success happens at an opportune time when many Bitcoin ETFs in the USA are experiencing inflows into their funds. The U.S. Spot Bitcoin ETF and Black Rock’s IBIT saw net inflows valued at $35. 66 billion this year, Black Rock’s IBIT was leading with $37 31 billion of the funds captured.
This huge inflow has also contributed to Bitcoin’s price surpassing the $100,000 mark for the first time, partly because BlackRock is a well-renowned company with $11 trillion in overall assets under management.
This dominance of IBIT has created a ripple effect throughout the entire ETF market, and gold ETFs have become a big casualty in this scenario. Gold ETFs are generally considered a haven, but this is the first time in six months that such massive outflows have been observed.
With a market size of $274 billion, gold TFs still represent a big chunk of the investment landscape. Yet analysts believe that IBIT may soon outpace even the largest gold ETF, the SPDR Gold Shares if Bitcoin’s price continues to rise.
Nate Geraci punctuated this trend with the following chart comparing the paths of gold ETFs and Bitcoin ETFs in the United States. Gold ETFs were first made available to investors in 2004, while Bitcoin ETFs became available in 2024. In the graph, Bitcoin is increasingly considered a viable replacement for gold, nicknamed “digital gold.”
One of the more ridiculous charts you’ll ever see…
Assets in spot gold ETFs vs bitcoin ETFs.
Gold ETFs launched in 2004.
Bitcoin ETFs in 2024.
via @glxyresearch pic.twitter.com/eJo7Db9kb3
— Nate Geraci (@NateGeraci) December 28, 2024
BlackRock’s IBIT changed not only the game in the ETF market but also brought Bitcoin to a new level in the global financial landscape. Its unprecedented growth and price impact on Bitcoin make this ETF a pivotal force for mainstream cryptocurrency adoption.
While interest in IBIT keeps building momentum, some very serious suppositions flow regarding long-term prospects for traditional finance and the more nascent crypto market.
