BlackRock’s Bitcoin ETF reached $10B in AUM in 7 weeks, outpacing gold ETF’s two-year record.
The iShares Bitcoin Trust by BlackRock has set a new benchmark in the investment world by gathering assets exceeding $10 billion within a mere seven weeks. This rapid accumulation of assets under management (AUM) starkly contrasts with the trajectory of the first U.S. gold-backed ETF, the SPDR Gold Shares, which required over two years post-launch in 2004 to reach a similar milestone. This development, as reported by the finance blog Zero Hedge, highlights the burgeoning investor interest in cryptocurrency as an asset class.
Launched with much anticipation, BlackRock’s iShares Bitcoin Trust (IBIT) achieved this remarkable feat by March 1, approximately 39 trading days following its introduction to the market. This growth trajectory underscores the increasing confidence and enthusiasm among investors for Bitcoin, showcasing its potential as a mainstream investment option.
Additionally, comparing this explosive growth to traditional gold investments reveals a significant shift in investor sentiment. Reflexivity Research co-founder, Will Clemente, noted the overwhelming influx into Bitcoin ETFs, which starkly overshadows the investment flows into gold. This sentiment was further echoed in recent trading days, with record inflows into Bitcoin ETFs significantly outpacing those into gold funds.
Change in Preference
Despite the surge in Bitcoin ETFs, gold enthusiasts like Peter Schiff remain unswayed, pointing out the media’s preoccupation with Bitcoin at the expense of reporting significant movements in the gold market. Nevertheless, the market dynamics tell a different story, with Bitcoin prices experiencing a 50% increase since the year’s start, in contrast to gold’s modest 1% gain.
Lastly, this shift in investment preference is not only reshaping the narrative around asset allocation but also suggesting a potential realignment in the store of value domain. Analysts, including Bloomberg’s Eric Balchunas, speculate that Bitcoin ETF might outstrip gold ETFs in AUM within the next two years, marking a pivotal change in investment paradigms.