The new fund offering comes as bitcoin struggles to break out of a bear market, trading around $67,000, down about 23% year-to-date. IBIT, which debuted in January 2024, has amassed nearly $49 billion in assets, making it the largest spot bitcoin ETF on the market. However, the fund has seen significant outflows since the start of the year, amid lower bitcoin prices and excitement around other asset classes, including the highly anticipated initial public offerings (IPOs) of SpaceX (SPCX) and Anthropic.
But Jacobs said BlackRock sees more potential audiences for the new fund.
One group consists of income-focused investors who want to diversify beyond traditional sources such as dividend-paying stocks and bonds. Another includes bitcoin holders who remain bullish on the cryptocurrency but want to generate cash flow from their positions.
“You could imagine that these could be people who have a significant portion of their wealth in bitcoin but would like an income stream to support their lifestyle,” Jacobs said.
A third group may be investors who have historically avoided assets like bitcoin or gold because they don’t produce cash flow.
“We’ve been dealing with these types of investors for years,” Jacobs said. “How can I own gold in a portfolio if it doesn’t generate money in any way? This product seeks to help address that market as well.”
