BlackRock’s launch of a new Bitcoin exchange-traded product (ETP) in Europe represents a significant advancement for the institutional adoption of Bitcoin in the region, though analysts predict that inflows will be lower compared to its US analogue.
The iShares Bitcoin ETP, managed by the world’s leading asset management firm, commenced trading on March 25 on platforms such as Xetra, Euronext Amsterdam, and Euronext Paris.
Though this launch is a notable development in providing European investors with access to Bitcoin (BTC), analysts from Bitfinex suggest that it is unlikely to achieve the same level of success as the US-based iShares Bitcoin Trust exchange-traded fund (ETF), which has experienced strong demand from both institutional and retail investors.
“The US spot Bitcoin ETFs were propelled by significant institutional demand, a robust capital market, and notable retail investor involvement,” stated Bitfinex analysts to Cointelegraph, additionally commenting:
“The introduction of a BlackRock Bitcoin ETP in Europe signifies a positive stride toward mainstream adoption, and as regulatory frameworks become clearer, institutional interest may increase over time.”
They further noted that while the Bitcoin ETP market in Europe may evolve more slowly, it is still an essential component of Bitcoin’s global adoption narrative.
With over $11.6 trillion in assets under management, BlackRock has the potential to facilitate a broader acceptance of Bitcoin investment products across Europe and create new avenues for institutional funds to enter the cryptocurrency sector.
In the US, the adoption of Bitcoin ETFs by institutions surged past 27% in the second quarter of 2024, with over 262 firms investing in Bitcoin ETFs, as reported by Cointelegraph on August 16.
BlackRock’s global standing may ignite momentum for European Bitcoin ETPs
According to Iliya Kalchev, a dispatch analyst at digital asset investment firm Nexo, BlackRock’s international reputation and expertise could “slowly foster momentum” for Bitcoin ETPs in Europe.
“While modest inflows shouldn’t be seen as a shortcoming, they reflect structural differences within the market,” Kalchev informed Cointelegraph, adding:
“The long-term achievement in Europe may rely less on initial week inflows and more on ongoing access, education, and infrastructure—areas where BlackRock is aptly positioned to provide.”
Although BlackRock’s European fund may not mirror the explosive growth of its US Bitcoin ETF, this reality should be “evaluated in context, rather than a cause for concern,” given the limited liquidity in the smaller European market.
BlackRock’s US spot Bitcoin ETF briefly surpassed $58 billion, making it the 31st largest ETF globally, covering both traditional and digital asset funds, with US Bitcoin ETFs exceeding $126 billion in total BTC holdings, as reported by Cointelegraph on January 31.
As of March 27, BlackRock’s ETF accounted for over 50.7% of the market share of all spot US Bitcoin ETFs, valued at $49 billion, according to Dune data.
