BlackRock’s bull case for bitcoin access among retail investors

This may be the year that Main Street’s appetite for cryptocurrency exposure increases meaningfully.

Although it’s been two years since the first spot bitcoin ETFs began trading on U.S. exchanges, BlackRock’s Jay Jacobs thinks they’re a fairly new concept.

“It’s still very early,” the firm’s head of U.S. equity ETFs told CNBC’s “ETF Edge” this week. “Many investors are just beginning their education journey on what Bitcoin is. [and] How can it fit into a portfolio? We see that it is still very early. bitcoin And Ethereum“

Black Rock manages iShares Bitcoin Trust ETF (IBIT) And iShares Ethereum Trust ETF (ETHA). As of Thursday’s market close, IBIT was down more than 3% last year. The weakness emerged after Bitcoin prices reached a record high around $126,000 last October. It is currently trading in the low $90,000 range.

ETHA, meanwhile, is lower by almost 6%.

Cryptocurrencies have received a lot of attention lately, in part because large-scale asset managers including BlackRock have expanded investors’ options for investing in them using equity-like formats, including ETFs.

“For many financial advisors, maybe they didn’t have access to crypto before or weren’t able to purchase IBIT before it was approved on their platform,” Jacobs said.

But for those willing to take the risk, the asset class instills a sense of loyalty despite volatility, says VettaFi’s Todd Rosenbluth.

“They’re sticking with it, they’re not selling out so quickly and looking for another alternative,” Rosenbluth told CNBC in the same interview.

Rosenbluth found that crypto investors remained fundamentally inactive despite the uncertainty.

“This suggests that investors who gain exposure to cryptocurrency through ETF wrapping have some commitment to the product and confidence in long-term trends,” Rosenbluth said. “They don’t necessarily move in and out based on that volatility.”