BlackRock’s Bold Move: Buying Bitcoin ETFs for Global Fund

BlackRock, recognized as one of the titans in the asset management sphere globally, is setting its sights on acquiring spot Bitcoin exchange-traded funds (ETFs) for its esteemed Global Allocation Fund, known as MALOX.

In a detailed March 7 update submitted to the filing with the United States Securities and Exchange Commission, BlackRock expressed its intention to incorporate physically backed Bitcoin exchange-traded products (ETPs), or more precisely, spot Bitcoin ETFs, into the investment strategy of MALOX.

This comprehensive update to the filing meticulously points out that MALOX might engage in purchasing BlackRock’s proprietary spot Bitcoin ETF, notably the iShares Bitcoin Trust (IBIT), alongside ETFs from various other issuers. The declaration made was explicit:

“The fund may acquire shares in ETPs that seek to reflect generally the performance of the price of Bitcoin by directly holding bitcoin — ‘Bitcoin ETPs’ — including shares of a Bitcoin ETP sponsored by an affiliate of BlackRock.”

It was emphasized that the fund is committed to investing solely in Bitcoin ETPs that enjoy the privilege of being listed and actively traded on reputable national securities exchanges, as per the filing's information.

Having been inaugurated in 1989, the BlackRock Global Allocation Fund is dedicated to generating investment returns through a rigorously managed investment policy that leverages U.S. and international equity, debt, and money market securities, showcasing investments in leading corporations such as Microsoft, Apple, among others. As of the update on March 7, MALOX boasted $17.8 billion in assets under its management.

It's noteworthy to mention that MALOX is not the solitary fund under BlackRock’s umbrella aiming to incorporate spot Bitcoin ETFs into its portfolio. This updated SEC filing was unveiled shortly after BlackRock lodged a similar filing amendment for its Strategic Income Opportunities Fund (BSIIX) dated March 4.

The spotlight has been on BlackRock’s spot Bitcoin ETF, the iShares Bitcoin Trust, which initiated trading on January 11, alongside a suite of nine other spot Bitcoin ETFs within the United States.

IBIT has distinguished itself as the most rapidly expanding spot Bitcoin ETF, with its BTC holdings soaring by an astonishing 7,000%, escalating from 2,621 BTC on January 11 to an impressive 187,531 BTC by March 7, 2024. At the current juncture, the valuation of IBIT’s Bitcoin assets stands at $12.6 billion.

Beyond its endeavors with the spot Bitcoin ETF, BlackRock has been fervently advocating for the establishment of a spot Ether ETF with the regulatory bodies in the U.S. In a strategic move in November 2023, BlackRock proceeded to submit a Form S-1 application for its iShares Ethereum Trust to the Delaware Division of Corporations.

The debate amongst industry analysts and enthusiasts is ongoing, pondering over whether U.S. regulatory authorities will green-light the launch of a spot ETH ETF within the year 2024. Reflecting on Bitcoin’s journey, it is notable that it took the SEC over a decade to endorse a spot ETF for Bitcoin in the American market.