BlackRock’s Bitcoin Trust Overtakes Gold Trust

CoinMarketCap
09 Nov 2024

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In a significant shift within the investment landscape, BlackRock’s iShares Bitcoin Trust (IBIT) has eclipsed the iShares Gold Trust (IAU) in total assets, reaching $33.2 billion. This remarkable growth occurred just two days following the election of Donald Trump, whose crypto-friendly policies have influenced market dynamics.

How Do Bitcoin and Gold Compare?

The surge in IBIT’s assets highlights a growing preference among BlackRock’s clientele for Bitcoin over traditional Gold investments. Such a shift suggests that Bitcoin is currently outperforming Gold in the marketplace.

What Impact Did the Election Have on Markets?

Following Trump’s electoral win, Bitcoin’s value surged nearly 12%, reaching record highs, as Gold prices stabilized around $2,686 per ounce after peaking at $2,789. This reflects a marked difference in market reactions to the new administration.

The U.S. spot Bitcoin ETFs saw about $1.4 billion in net inflows recently, driven by a heightened appetite for riskier assets. The Federal Reserve’s decision to reduce interest rates by 25 basis points further fueled this demand.

  • IBIT constitutes 42% of the total net assets held by 11 U.S. spot Bitcoin ETFs, which amount to $78.5 billion.
  • ETF inflows for Bitcoin have significantly outperformed those for Gold, indicating a rising trend.
  • IBIT’s launch in January 2024 underlines the increasing acceptance of cryptocurrencies in financial markets.

This trend signifies a pivotal moment as institutional interest in Bitcoin grows, challenging the long-held dominance of Gold as a safe asset. The implications for the financial market and traditional commodities could be profound as this new era of investment unfolds.

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