BlackRock’s Spot Bitcoin exchange-traded fund is an entry point for new investors into the broader ETF market, said Jay Jacobs, BlackRock’s head of equity ETFs in the United States.
About three-quarters of investors in BlackRock’s iShares Bitcoin Trust ETF have never owned an ETF before, Jacobs said. said Cointelegraph on Thursday’s podcast “Chain Reaction.”
“IBIT has been a vehicle for traditional investors to get into digital assets. But starting with digital asset ETPs, we’ve seen a lot of people really get into IBIT,” he said.
Bitcoin ETFs have emerged as a way to bring traditional investors into the world of digital assets. BlackRock’s Jacob suggests the change has been two-way.
iShares Bitcoin Trust, launched in January 2024, is BlackRock’s flagship crypto product with $48 billion in assets under management. It holds 765,936 BTC and is the gateway for many digital asset investors to participate in ETPs.
However, Jacobs said that once investors are exposed to Bitcoin products, many start buying other BlackRock funds such as the S&P 500 (IVV), artificial intelligence (BAI) and gold (IAU).
“This is a way of engaging with a different group of people than perhaps we’ve ever engaged with before, so we totally understand that,” he said.
The company launched a new product on Wednesday called the iShares Bitcoin Premium Income ETF (BITA). This earns money by selling covered call options on your Bitcoin holdings.
The “Great Convergence” of TradFi and Cryptocurrency
Jacobs said Bitcoiner’s involvement with TradFi began amid the growing overlap between cryptocurrencies, decentralized finance, and traditional finance in what BlackRock is calling the “Great Convergence.”
“Historically, we have seen different assets held separately,” he says. He said: “DeFi and TradFi, actively managed funds and index funds, personal assets and listed assets… and what’s happening now is that people are looking for more solutions to manage their portfolios.”
“I think you’re going to hear less about TradFi vs. DeFi. I think you’re going to see more of the TradFi vs. DeFi ampersand.”
Recent examples can be seen during high-profile events. SpaceX IPO earlier this monthcrypto traders will be given the chance to get a piece of the action through pre-IPO perpetual futures Or tokenized stocks.
The Pre-IPO benefit allows investors to gain exposure to private companies before they begin trading on the TradFi exchange.
All major crypto exchanges now offer pre-IPO benefits, and trading volume has surged from about $1 billion in early May to about $22 billion, with Binance establishing itself as the largest exchange. According to To CryptoQuant.
Pre-IPO PERP trading volume on crypto exchanges has skyrocketed in the past few weeks. Source: CryptoQuant
