BlackRock’s recent entry into the spot Bitcoin exchange-traded fund (ETF) market has raised speculation about potential supply constraints. Reportedly, BlackRock acquired 11,439 Bitcoins in connection with the official launch of their spot Bitcoin ETF. To put this into perspective, this quantity represents more than 13 days’ worth of Bitcoin production, based on the average daily issuance of around 900 Bitcoins, as reported by InvestAnswers.
Massive Purchase Raises Supply Concerns
InvestAnswers emphasized the significant impact of one player, BlackRock, swiftly withdrawing 11,500 BTC from the system in just two days, equivalent to approximately 13 days of the typical supply.
As BlackRock rapidly accumulated Bitcoin reserves, the largest asset manager in the world raised concerns about a potential shortage of supply.
InvestAnswers noted that the IBIT Spot ETF only managed to capture an average of 25% of the trading volume over the course of two days, implying that around 46,000 BTC were withdrawn during that time. If this pace continues, it could lead to a severe supply shortage.
InvestAnswers shared their calculation, stating that at a rate of 11,500 BTC every two days, or 23,000 BTC per day, this would be 25.56 times the daily production consumed by US ETFs alone.
Initial exchange data indicated that Grayscale led the trading volume rankings on the first day. However, Bloomberg Intelligence ETF analyst James Seyffart suggested that much of this volume could be attributed to selling GBTC and purchasing other ETFs at the moment.
The statistics also revealed that BlackRock’s iShares Bitcoin Trust ranked second with a trading volume of over $1 billion.
BlackRock Releases New Bitcoin ETF Ads
BlackRock has rolled out a new advertising campaign for its spot Bitcoin ETF, and it appears to be targeting a broader audience beyond just crypto enthusiasts. The aim is to promote their Bitcoin ETF to a wider range of investors in the United States.
According to James Seyffart, “BlackRock’s Bitcoin pitch [is] coming to cable TV news, ‘Antiques Roadshow’ episodes, and the Weather Channel near you.” This indicates a strategic effort by established financial institutions like BlackRock and Fidelity to market crypto products to investors who may not have previously considered Bitcoin. The market is anticipating significant inflows as a result of Bitcoin ETFs.
Bloomberg analyst Eric Balchunas commented on the marketing approach, stating, “This is how you market to rich boomers, folks. The calm disposition, easy-to-understand investment case, soft new-age music, suit with no tie. Everything about it says ‘it’s okay now, the adults are here’.” This suggests a deliberate strategy to make Bitcoin investment more appealing and accessible to a broader demographic.
