BlackRock executive: Bitcoin ETF promotes TradFi and cryptocurrency convergence

Author: Ben Strack, Blockworks; Compiler: Deng Tong, Golden Finance

A senior executive of the world's largest asset management company said, US Spot Bitcoin ETF drives broader integration of traditional finance and cryptocurrencies.

BlackRock Managing Director Tony Ashraf spoke at the Blockworks Digital Asset Summit in London on Tuesday, pointing to the move by large financial institutions to put Bitcoin The impact of coin packaging into ETFs.

On the other hand, Crypto industry companies and innovations are beginning to develop traditional finance through asset tokenization, which The process involves bringing physical and financial assets onto the chain.

Ashraf said: “Because of the catalyst for the [Bitcoin] ETF , the duality between traditional finance and cryptocurrencies is starting to manifest itself in a very different way." "I think... we will see more convergence happening in the future."< /p>

As of December 31, BlackRock managed approximately US$10 trillion in assets. The company launched one of 10 U.S. Bitcoin ETFs to list on January 11.

The fund, iShares Bitcoin Trust (IBIT), has been ahead of its rivals from a net inflow perspective so far.

BitMEX research data shows that as of Monday’s close, IBIT’s net inflows were close to $13 billion. That’s nearly double the $6.9 billion of the second-largest asset collector, Fidelity Investments’ Wise Origin Bitcoin Fund (FBTC).

Grayscale Investments’ Bitcoin Trust ETF (GBTC) remains the largest fund in the space, with net outflows of nearly $12.5 billion to date.

Increase the opportunity to welcome new customer groups

Ashraf believes that given the U.S. Bitcoin ETF’s Approval, one cannot underestimate the impact of who can now deploy cryptocurrencies.

“We have a whole new group of investors coming into this space who may buy, hold and use ETF structures in different ways,” he said.

Ten U.S. spot Bitcoin ETFs brought in about $2.5 billion in net inflows last week, setting a record for the space. The category saw its first net outflow since March 1 on Monday, amounting to $154 million, BitMEX Research data showed.

Nonetheless, Bitwise Chief Investment Officer Matthew Hougan said during a panel discussion with Ashraf on Tuesday that he expects the U.S. Assets under management of Bitcoin ETFs are likely to grow from about $50 billion today to hundreds of billions of dollars in the next few years.

Initial interest in these funds was generated through self-directed retail investors and registered investment advisors (RIAs).

Hougan noted that Bitcoin ETFs are not yet widely available on national account platforms such as Morgan Stanley, Merrill Lynch, Wells Fargo and UBS, which are still approving the funds for their advisors.

But Bitwise CIO said he expects one or more major companies to approve such funding in as little as a week.

"You should think of the flows we're seeing in these ETFs as a faucet that's turned on 20%," Hougan said. "There is still 80% work to be done, and this process will continue for a while."

Leon Marshall, CEO of Galaxy Digital's European operations, said during the panel discussion that liquidity will also increase in the future.

This liquidity could spark more interest from businesses, sovereign wealth funds and central banks, he added .

“They will only be interested in an asset class when it reaches the specific level of assets they manage,” Marshall said. “So, Bitcoin does benefit from the effect that the larger it is, the more attractive it becomes as an asset class to new groups of customers.”< /span>