BlackRock CEO Larry Fink once dismissed Bitcoin as money-laundering territory. Now he calls it digital gold, and his firm's iShares Bitcoin Trust has grown into one of the fastest-growing ETFs in history. The reversal tracks Bitcoin's own rocky path this year, from a 53% drop to a rebound above $80,000.
Larry Fink's Bitcoin conversion did not happen overnight. In 2017, the BlackRock chief dismissed the asset as an index of money laundering, a view he has since reversed entirely, now framing Bitcoin as digital gold. The shift paid off: BlackRock's Bitcoin ETF turned into one of the firm's biggest earners.
From skeptic to backer
The Observer traced Fink's seven-year reversal from crypto critic to advocate. Bitcoin has a long history of winning over doubters — Michael Saylor, who built Strategy into the largest corporate Bitcoin holder, once said the asset's days were numbered in 2013. Strategy now holds more than 845,000 BTC.
IBIT becomes a Wall Street giant
In January 2024, the SEC approved BlackRock's iShares Bitcoin Trust alongside 10 other spot Bitcoin ETFs, giving investors regulated exposure to Bitcoin without custody requirements. IBIT then broke records, reaching $70 billion in assets in 341 trading days and becoming BlackRock's top fee-generating ETF.
When Bitcoin surged above $126,000 last October, IBIT briefly approached $100 billion in assets, reaching that mark five times faster than any ETF in history, according to Bloomberg.
Volatility test outlives the rally
Wall Street access did not shield investors from Bitcoin's swings. By June, Bitcoin had fallen below $60,000, a roughly 53% decline from its October peak. Spot Bitcoin ETFs then logged a record eight consecutive weeks of net outflows, shedding roughly $8.3 billion between May and early July.
Bitcoin has since reclaimed $80,000, helped by the Treasury's announcement that it would at least double buybacks of longer-dated government debt, easing pressure on bond yields. Around the same time, President Trump hosted crypto and finance executives at the White House and urged Congress to pass the CLARITY Act.
How much Bitcoin belongs in a portfolio
BlackRock's answer to Bitcoin's volatility is not to avoid it, but to size it carefully. In 2024, the firm suggested a 1% to 2% Bitcoin allocation could suit investors willing to accept the risk, comparing that portfolio allocation to the risk budget of the "Magnificent Seven" stocks in a 60/40 portfolio.
At Davos in 2025, Fink said he had discussed a possible 2% to 5% allocation with a sovereign wealth fund. He suggested Bitcoin could reach $700,000 if institutional allocations of that size became widespread. Vanessa Grellet, managing partner at Arche Capital, has made a similar case, citing spot ETF flows and sovereign wealth fund interest. According to a LinkedIn post: "The institutional momentum around digital assets is undeniable".
Source: Moneywise
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