The leading cryptocurrency, Bitcoin, has continued its weak performance in recent days, trading around the $74,000 level. This has been reflected in outflows from spot ETFs, and a noteworthy statement has come from BlackRock, one of the world’s largest asset management companies.
Robbie Mitchnick, head of digital assets at BlackRock, stated that the way large investors in the Bitcoin market store their assets is changing.
$3.6 Billion Transformation Among Bitcoin Whales!
Speaking to Barron’s, BlackRock’s Robbie Mitchnick stated that investor demand to convert their directly held Bitcoins into shares in the company’s spot Bitcoin ETF, iShares Bitcoin Trust (IBIT), has reached record levels.
Mitchnick said that approximately $3.6 billion worth of Bitcoin has been converted into IBIT shares since regulators approved the creation and buyback of in-kind shares for BlackRock’s spot ETF.
Mithnick stated that conversion demand has been steadily increasing regardless of Bitcoin price fluctuations, and current interest has reached its highest level ever. It was also noted that the reported amount may be lower than the actual total because BlackRock does not directly process all transactions.
Mithnick states that the most important reason behind the conversions to IBIT is security and the desire to hold their assets in a more secure environment. Investors are preferring institutional custody services over wallets or online cryptocurrency platforms where they manage their own private keys.
This method allows investors to transfer their Bitcoins to the fund without selling them, and in return receive ETF shares. This enables them to manage their assets through traditional investment accounts.
Additionally, BlackRock recently lowered the minimum transaction threshold for in-kind ETF equity conversions from approximately $30 million to around $1 million-$2 million.
*This is not investment advice.
