BlackRock’s Crypto ETFs Outshine Grayscale’s in AUM

• BlackRock surpasses Grayscale as the largest crypto fund manager, with over $21 billion in AUM.
• Grayscale faces significant outflows, losing ground to BlackRock’s rapidly growing crypto ETFs.
• BlackRock’s lower fees and brand strength attract investors, challenging Grayscale’s market dominance.

BlackRock’s ETFs have hit a major milestone in the cryptocurrency market. For the first time ever, BlackRock’s Bitcoin (IBIT) and Ethereum (ETHA) ETFs have surpassed Grayscale’s ETFs — including GBTC, BTC Mini, ETHE, and ETH Mini — in on-chain holdings.

BlackRock’s ETF holdings now total an impressive $21.22 billion in assets under management (AUM). In comparison, Grayscale’s ETF holdings are slightly lower at $21.20 billion. This marks a turning point in the competition between these two financial giants, establishing BlackRock as the largest provider of crypto ETFs by collective holdings.

This shift is significant because Grayscale has long dominated the cryptocurrency ETF market. However, BlackRock’s recent surge in ETF holdings has allowed it to overtake Grayscale, solidifying its position as a major player in the crypto space. The change in holdings clearly shows BlackRock’s growing influence and success in attracting investors to its cryptocurrency products.

The on-chain data shows that BlackRock’s IBIT and ETHA ETFs now lead in terms of assets under management. This change is remarkable, considering Grayscale’s GBTC and ETHE have been market leaders for years. The increase in BlackRock’s ETF holdings reflects a broader trend of institutional interest in cryptocurrency investments.

Investors are increasingly choosing BlackRock’s ETFs as they seek exposure to Bitcoin and Ethereum, the two largest cryptocurrencies by market capitalization. This surge in demand for BlackRock’s products can be attributed to the company’s reputation and the growing acceptance of cryptocurrency as a legitimate asset class.

James Butterfill, Head of Research at CoinShares, commented that BlackRock’s rapid rise highlights the power of established ETF providers. Grayscale has been the dominant player for years, but its high fees have become a drawback. BlackRock’s lower-cost options have proven more appealing to investors. Grayscale’s Ethereum Trust (ETHE) alone has seen $2.3 billion in outflows since the launch of spot Ethereum ETFs. This loss underscores the challenge Grayscale faces in maintaining its market leadership.

BlackRock’s strong performance in the crypto market further emphasizes the growing competition among traditional financial institutions to capture a share of the digital asset market. The company’s ability to surpass Grayscale in on-chain holdings highlights the dynamic and ever-changing nature of the crypto ETF landscape.