BlackRock’s crazy buying of BTC will affect the crypto market?

Author: Qin Jin, Carbon Chain Value

BlackRock, the world’s largest asset management company, has accumulated 11,500 Bitcoins for its newly listed Bitcoin spot ETF. Valued at nearly $500 million. According to foreign media Thestreet, this financial giant with a market capitalization of US$9 trillion on Wall Street is rapidly building one of the world's largest BTC reserves. It has now surpassed Tesla’s 9,270 Bitcoins, becoming the third largest Bitcoin holder among listed companies.

If it accumulates BTC at this rate, BlackRock will soon hold more Bitcoins than any other entity in the world. Bloomberg ETF senior analyst Eric Balchunas said this "will happen."

Eric Balchunas said that BlackRock’s position in terms of Bitcoin holdings is strengthening, and the question now is “when” it will surpass MicroStrategy, not “if” it will surpass MicroStrategy. After analysis, it was found that the total trading volume of the two spot Bitcoin ETFs of BlackRock and Fidelity has exceeded $3.1 billion to date, most of which is capital inflows. In comparison, the other two ETFs Grayscale’s GBTC and ProShares’ BITO Although the transaction volume reached US$4.65 billion and US$3.26 billion respectively, accounting for more than 60% of the total transaction volume, most of them were capital outflows, most likely because investors chose to sell after recovering losses in the past year.

The key difference between BlackRock and MicroStrategy is that the former reserves Bitcoin as the basis for the ETF. The latter holds Bitcoin as a treasury reserve asset as a public holder. MicroStrategy currently holds more than 189,000 Bitcoins.

According to the iShares Bitcoin Trust holdings data published on the BlackRock website, the product holds 11,439.2198 "shares" of Bitcoin, with a market value of US$497,994,992.41. The product has seen strong early trading volume, but Bitcoin’s spot price has remained relatively stagnant. However, if BlackRock continues to accumulate Bitcoin at this rate, the Bitcoin market will surely suffer.

According to CryptoSlate, since the launch of the spot Bitcoin ETF, BlackRock purchased an astonishing 11,500 Bitcoins from the market supply during the last Bitcoin drop. Considering that only 900 Bitcoins are issued every day, this amount is quite impressive. If this trend continues, the Bitcoin market could face a severe supply crunch.

While BlackRock CEO Larry Fink has publicly criticized Bitcoin in the past, his public views following the listing of the company’s spot ETF indicate a complete shift in attitude. . Last week, he praised Bitcoin as digital gold and an asset that can protect investors. BlackRock also released an ad targeting “boomers” for its spot Bitcoin ETF.

According to updated data from Bloomberg, the trading volume of the Bitcoin spot ETF has exceeded US$10 billion in the three days before its listing. Bloomberg senior ETF analyst Eric Balchunas said how crazy $10 billion in trading volume is in 3 days. The current total trading volume of the 500 ETFs launched in 2023 is only US$450 million. The best ETF is only $45 million. Many ETFs started operating months ago. The trading volume of $IBIT alone exceeds the trading volume of the entire freshman class of 2023.

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