BlackRock CEO Larry Fink was once a “proud skeptic” of bitcoin, but now his money management giant is emerging as one of the biggest beneficiaries of a post-election wave of enthusiasm for the world’s largest cryptocurrency.
BlackRock’s spot bitcoin exchange-traded fund (IBIT) has risen by $13 billion since Donald Trump’s victory on November 5, according to data from Yahoo Finance, pushing iShares Bitcoin Trust past $40 billion in assets just 10 months after launch increased.
This performance puts IBIT among the top 1% of the largest ETFs in record time, according to Bloomberg Intelligence analyst Eric Balchunas.
“We had some pretty bullish forecasts, but you know, I don’t think anyone is ever going to write down their bull case as a baseline, or maybe even that year they’re going to rewrite the record book on inflows into the ETF category,” said Robbie Mitchnick, BlackRock’s head of digital assets, appeared on the Unchained podcast last week.
Plenty of other companies are also benefiting from the new boom, as investors bet that pro-crypto legislation could be possible in Washington, DC, under a new Trump administration and a Republican Party-controlled Congress.
Shares of Coinbase (COIN), the largest US cryptocurrency exchange, have risen 58% since the election. Shares of MicroStrategy (MSTR), a software company that became the largest corporate bitcoin holder, have risen 50%.
The record inflows into BlackRock illustrate how crypto continues to move into the mainstream of investing as it is embraced by some of the biggest names on Wall Street – even some who were once its biggest critics.
Fink, who runs the world’s largest money manager, falls into that category.
“I was a proud skeptic, and I studied it, learned about it, and I came away saying, okay, you know, my opinion [for] five years was wrong,” Fink said earlier this year while discussing his past views with CNBC.
Perhaps the best example of that shift came in June 2023 when BlackRock filed with the Securities and Exchange Commission to launch a spot bitcoin ETF. That was at a time when the crypto and asset management industries had little evidence that such a product would be approved by SEC Chairman Gary Gensler.
Nevertheless, the company and ten other money managers were given the green light in January, followed by a stock exchange listing on January 12.
“BlackRock always seems to be in the right place,” Stephen Biggar, an analyst at Argus Research who covers the asset manager, told Yahoo Finance.
Its embrace of crypto (it also launched a smaller spot ether ETF in late July) coincided with an election year in which pro-crypto Congressional candidates received millions in industry donations and Trump as a candidate made a number of promises to the industry.
Trump promised to fire SEC Chairman Gensler, one of the industry’s biggest opponents, appoint a presidential advisory council on cryptocurrency and build a “strategic national bitcoin stockpile” with the help of Congress.
Bitcoin (BTC-USD) then rose to a new all-time high above $93,000 in the week following Trump’s victory before giving up some of those gains. It is now up 30% since the election and 112% so far in 2024.
On the Thursday after the election, spot bitcoin ETFs saw a record $1.3 billion in net assets flow in, according to Kaiko Research, with BlackRock reaping 85% of that total.
The two crypto ETFs now represent approximately 42% of the total $102 billion worth of spot crypto ETFs in the industry.
“The amazing thing about this story is that it takes so long to build a good foundation,” Balchunas told Yahoo Finance. “And they did it so quickly that they were in such a good position to take advantage of this rally.”
BlackRock’s iShares Bitcoin Trust could rake in even more money from investors now that it has crossed the $40 billion threshold, as financial advisors succumb to the fear of missing out.
“There could come a point where advisors decide ‘I should have it to avoid getting fired’ versus ‘I don’t want to buy it and piss off my client because he has some stupid bitcoin ETF,’” Balchunas said .
Such a “tipping point” would certainly trigger a new wave of mainstream embrace of crypto, he added.
David Hollerith is a senior reporter for Yahoo Finance covering banking, crypto and other financial areas.
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