BlackRock has increased its exposure to cryptocurrencies, buying an additional 529 BTC and 2,420 ETH. With these new acquisitions, BlackRock now has 359,606 BTC with an estimated value of $22.82 billion and 350,000 ETH with an estimated value of $23 billion.
The on-going purchasing by BlackRock demonstrates that institutional investors remain bullish on the long-term investment potential of digital assets, especially BTC.
BlackRock’s Growing Bitcoin Holdings
As per Arkham Intelligence, BlackRock, the biggest asset manager globally, has been upping its bets on Bitcoin, given its view that the cryptocurrency can offer protection against various risks. The firm has added 529 BTC to its balance, increasing its total Bitcoin reserves to stand at 359, 606.
Most of these holdings are vested in BlackRock’s iShares Bitcoin Trust (IBIT) that gives investors direct exposure to Bitcoin.
The asset manager’s bullish buying spree comes at a time when Bitcoin is being eyed as a ‘risk-off’ asset amid the traditional perception of cryptocurrencies as high-risk investments. According to Mitchnick, BlackRock’s head of digital assets, Bitcoin is not like other risk-on assets such as equities since it is a decentralized, non-sovereign, and scarce global asset.
BTC ETF Sees Record Inflows
Concurrently, BlackRock’s iShares Bitcoin Trust has seen inflows of more than $99 million of Bitcoin, which is the highest single-day inflow in the last 30 days.
This increase in investment is due to the heightened interest from institutional investors in Bitcoin exposure through regulated ETFs which provide an easier way for investors to make profits from the appreciation of Bitcoin price.
The ETF’s performance is particularly impressive given the current economic conditions, as investors are looking for new ways to invest in addition to equities and bonds. Mitchnick’s recent comments are in line with BlackRock’s perception of Bitcoin as a diversifier, emphasizing its capacity to do well during periods of market instability.
Bitcoin’s Market Outlook for Q4 2024
The latest acquisition by the asset manager occurs at a time when there is rising optimism in the market with regard to Bitcoin especially in the fourth quarter of the year which has been historically favorable for the cryptocurrency. Bitcoin price has gained more than 5% in the past one week, touching a high of $64, 440, amid expectations of further appreciation in the fourth quarter of the year. Analysts are eyeing potential resistance levels near $70,000, with some predicting a surge to as high as $172,800 by the end of 2024, fueled by favorable macroeconomic conditions and increased liquidity in the market.
The recent actions of the Federal Reserve, such as a 50 basis points rate cut, have also fanned the rally of Bitcoin as low-interest rates are favorable to risky assets as they decrease the return of holding bonds and other gains-yielding assets. As BlackRock continues the buying and positive market trends, many are eagerly waiting to see if Bitcoin can hold onto its gains in the next couple of months.
While BlackRock’s continued accumulation supports the bullish case for Bitcoin price, recent movements from Mt. Gox, the defunct crypto exchange have stirred up worries. Mt. Gox has transferred a significant portion of its BTC holdings, emptying four wallets after receiving 370,000 BTC from Kraken. This move has fueled speculation that Mt. Gox may be preparing to make repayments to its remaining creditors, which could introduce increased selling pressure on the market.
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