BlackRock, the world’s largest asset management firm, is expanding its cryptocurrency offerings into Europe with the launch of a Bitcoin ($BTC) exchange-traded product (ETP).
The new ETP, called the iShares Bitcoin ETP, will begin trading on major European exchanges on Tuesday. This marks BlackRock’s first crypto ETP outside of North America, following the success of its Bitcoin fund in the US earlier in 2024.
The iShares Bitcoin ETP will be available on multiple exchanges in Europe, including Germany’s Xetra, Euronext Paris, and Euronext Amsterdam. It will be listed under the ticker symbols IB1T on Xetra and Euronext Paris, and BTCN on Euronext Amsterdam.
This new product offers European investors a chance to gain direct exposure to Bitcoin through a regulated investment vehicle, making it easier and safer for both institutional and retail investors to enter the cryptocurrency market.
The product will be physically backed by Bitcoin, with the digital currency stored securely by Coinbase Global Inc., one of the largest cryptocurrency exchanges in the world. To encourage investors to try the product, BlackRock is offering a temporary fee waiver.
The expense ratio will be reduced to 0.15% until the end of 2025, after which it will return to a 0.25% fee. This makes BlackRock’s offering one of the most affordable Bitcoin ETPs in Europe, helping it stand out in a competitive market.
BlackRock’s confidence in the European market
This move into Europe follows BlackRock’s success with its iShares Bitcoin Trust, which was launched in the US in January 2024. The US version of the product has seen remarkable growth, amassing $48 billion in assets in just over a year.
BlackRock hopes to replicate this success in Europe, which, while smaller, offers a promising market for Bitcoin investment products.
Europe has been slower to embrace Bitcoin exchange-traded products compared to the US As of now, the total value of Bitcoin ETPs in Europe is about $13.6 billion. In contrast, the US market is much larger, with spot Bitcoin ETFs holding around 91% of the total global assets.
Nevertheless, BlackRock’s expansion into Europe is a sign of growing institutional interest in digital assets in the region. The firm is betting that, as interest in cryptocurrencies grows, the European market will become a significant part of its global business.
The head of iShares Product for Europe and the Middle East at BlackRock, Manuela Sperandeo, explained the timing of the launch. “It reflects what really could be seen as a tipping point in the industry. The combination of established demand from retail investors with more professionals now really getting into the fold shows the growing interest in digital assets”, Sperandeo said.
Europe’s growing interest in digital assets
The introduction of BlackRock’s iShares Bitcoin ETP is happening at a time when Europe’s regulatory environment is becoming more favourable for cryptocurrency investments.
In 2024, the European Union introduced the Markets in Crypto-Assets Regulation (MiCA), which aims to provide clear rules for digital assets. This regulation is expected to provide a stable foundation for the growth of Bitcoin-backed products like the iShares Bitcoin ETP.
While Europe has hosted crypto ETPs for several years, the market is still small compared to the US. According to the ETF analyst at Bloomberg, Eric Balchunas, the US has dominated the market for Bitcoin ETPs.
“US spot Bitcoin ETFs dominate the global market”, he said, noting that the US holds around 91% of the total global assets in Bitcoin ETFs, even though these products have only been available for a little over a year.
Despite Europe’s smaller market, BlackRock’s entry is expected to have a significant impact. The firm’s reputation and large-scale operations are likely to drive increased competition, which could lead to lower fees and better liquidity in Europe.
Balchunas also speculated that BlackRock’s success in the US could help it attract European investors. “If BlackRock brings even some of the US Terrordome over there, it should see success”, he said, referring to the massive popularity of Bitcoin ETFs in the US.
BlackRock’s entry also aligns with the growing interest in cryptocurrency from European institutional investors. Many large firms are starting to see the value in adding digital assets to their portfolios.
This shift is being driven by the success of the US market, which has already seen Bitcoin ETFs become a popular investment vehicle. By offering a Bitcoin ETP in Europe, BlackRock is positioning itself to benefit from this growing trend.
How does iShares Bitcoin ETP work?
The iShares Bitcoin ETP offers European investors a simple and regulated way to invest in Bitcoin without having to purchase the cryptocurrency directly.
Bitcoin is a highly volatile asset, and for many investors, purchasing the digital currency on an exchange can be intimidating.
The iShares Bitcoin ETP allows investors to buy shares in a fund that holds Bitcoin, with the digital currency stored securely by Coinbase. This reduces the complexity and risk involved in owning Bitcoin directly.
The product will be issued through a special purpose vehicle (SPV) based in Switzerland. SPVs are legal entities that allow financial products to be structured in a way that complies with regulations.
This structure ensures that the Bitcoin held by the ETP is safe and properly managed, making it an attractive option for both institutional investors and qualified retail investors.
To make the product even more appealing, BlackRock is offering a fee waiver for the first part of its launch. The expense ratio will be set at 0.15% until the end of 2025.
After that, it will rise to 0.25%, which is still competitive compared to other Bitcoin ETPs in Europe.
For example, CoinShares, a leading European provider of crypto investment products, charges a similar fee of 0.25% for its Bitcoin ETP, which currently holds $1.3 billion in assets.
BlackRock’s move into the European Bitcoin ETP market is part of a larger strategy to expand its influence in the cryptocurrency space. In addition to its success in the US, the firm has been posting impressive financial results.
In the fourth quarter of 2024, BlackRock’s assets under management (AUM) hit $11.6 trillion, a record high. This is up from $11.48 trillion in the previous quarter and $10.01 trillion the year before.
The company’s strong performance is being driven by a combination of factors, including solid market returns and increased demand for both traditional and alternative investment products.
In the same quarter, BlackRock saw a 21% increase in profits, with net income rising to $1.67 billion, or $10.63 per share, compared to $1.38 billion, or $9.15 per share, a year earlier.
Much of this growth is attributed to the firm’s continued expansion into private markets, where demand for alternative assets is strong. BlackRock has also been aggressively acquiring other firms, including Global Infrastructure Partners and HPS Investment Partners, to increase its exposure to private markets.
CEO, Larry Fink, highlighted the firm’s strategy in a statement: “For many companies, periods of M&A contribute to a pause in client engagement. At BlackRock, clients are instead embracing and rewarding our strategy”.
A changing landscape
The launch of BlackRock’s Bitcoin ETP is a clear signal that cryptocurrency investment is becoming increasingly mainstream.
The growing interest from institutional investors, coupled with Europe’s more favourable regulatory environment, is helping to create a more stable and predictable market for digital assets.
As more investors gain exposure to cryptocurrencies through products like Bitcoin ETPs, the market is likely to grow, and Bitcoin’s position as the leading cryptocurrency will likely remain strong.
However, Bitcoin’s price remains volatile. As of the latest trading data, Bitcoin’s price has dipped by 0.55% in the last 24 hours, trading at $86,601. This fluctuation is typical of the cryptocurrency market, where prices can swing dramatically in a short period.
Despite the volatility, Bitcoin remains the dominant force in the crypto market, with a market dominance of 60.50% and a fully diluted market cap of $1.82 trillion.
