Key Takeaways
BlackRock’s Mitchnick highlighted that their client base is predominantly interested in Bitcoin, with some interest in Ethereum.
BlackRock considers Bitcoin and Ethereum as complementary assets with distinct roles.
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The SEC’s greenlight for spot Ethereum ETFs has sparked optimism about the future of other crypto ETFs, with some anticipating that Solana funds will be next in line. However, BlackRock’s Head of Digital Assets Robert Mitchnick thinks this is unlikely since their customers show “very little” demand for other cryptos beyond Bitcoin and Ethereum.
“I would say that our client base today, their interest overwhelmingly is in Bitcoin first, and then somewhat in ETH… and there’s very little interest today beyond those two,” said Mitchnick, speaking at the Bitcoin 2024 convention in Nashville yesterday.
“I don’t think we’re gonna see a long list of crypto ETFs,” Mitchnick noted.
BlackRock’s iShares Bitcoin Trust (IBIT) went live in January. The fund’s holdings have exceeded $22 billion worth of Bitcoin, becoming the world’s largest Bitcoin ETF, according to updated data.
Following IBIT’s debut, BlackRock entered the Ethereum ETF market earlier this week. Its iShares Ethereum Trust (ETHA) just ended its third trading day with almost $71 million in daily inflows, as reported by Crypto Briefing.
BlackRock may see limited client interest in other crypto ETFs, but some of its competitors may not.
On June 27, asset manager VanEck filed for the first Solana Trust in the US. Matthew Sigel, Head of Digital Assets Research at VanEck, said the firm believes SOL is a commodity.
Just one day after VanEck’s application, 21Shares followed with a filing to launch “21Shares Core Solana ETF,” an ETF seeking to give direct exposure to Solana. The firm said the filing was a necessary step.
Another major fund manager, Franklin Templeton, also touted Solana in an X post which came on the debut day of its spot Ethereum ETF.
Not all fund managers disagree with BlackRock. ARK Invest CEO Cathie Wood said in a February interview with WSJ that the SEC is unlikely to accept spot products for any other crypto besides Bitcoin and Ethereum.
Wood’s ARK Invest, however, opted out its spot Ethereum ETF pursue following listing approval on May 23.
Bitcoin and Ethereum as complementary assets
Blackrock views Bitcoin and Ethereum as complementary assets with distinct roles, rather than “competitors” or “substitutes,” said Mitchnick.
“Bitcoin is trying to be as a global monetary alternative, as a potential global payment system,” while “ETH is trying to do a bunch of different applications that for the most part, Bitcoin is not trying to do,” the executive explained.
Mitchnick predicts investors will allocate approximately 20% of their crypto holdings to Ethereum and the remaining 80% to Bitcoin.
Previously, Rick Rieder, BlackRock’s Global Chief Investment Officer of Fixed Income, told WSJ BlackRock may add more Bitcoin to its portfolio if investors become more comfortable with it.
BlackRock’s IBIT is one of the most successful ETFs. The fund has outperformed the Nasdaq ETF in terms of inflows this year, ranking fourth among over 3,000 US ETFs, as reported by Crypto Briefing.
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