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BlackRock’s Perspective on Bitcoin Scarcity

Wed Mar 05 2025

As regulatory landscapes evolve and institutional players deepen their involvement, Bitcoin’s role in diversified investment portfolios is likely to expand. Investors will closely monitor market trends, seeking opportunities amid price fluctuations and emerging macroeconomic factors.

BlackRock’s Bitcoin ETF Hits Record Trading Volume Amid Market Jitters 📉🚀

BlackRock’s spot Bitcoin ETF (IBIT) just saw its highest trading volume since November, as market turbulence pushed investors into panic mode. Despite holding a massive $39.6 billion in assets, IBIT plunged over 11% last week, with over $1 billion in outflows—its worst performance in months.

Market Turmoil and Investor Reactions 🔄📉

🔹 IBIT’s volume skyrocketed as 331 million shares changed hands while Bitcoin’s price dipped below its key support at $50.69.
🔹 The ETF hit a low of $46.07, triggering heavy withdrawals and a bearish outlook.
🔹 The shrinking CME futures basis—which reflects weakening demand for carry trades—added to investor fears.

Despite this, IBIT remains the world’s largest Bitcoin ETF, signaling strong institutional presence even amid sell-offs.

BlackRock’s Take: Bitcoin’s Scarcity = Long-Term Value 🏆🪙

BlackRock analysts Brett Wager and Michael Gates dropped a new report emphasizing Bitcoin’s scarcity and investment potential:

✅ Bitcoin’s real supply is even smaller—3 to 4 million BTC are lost forever.
✅ If every U.S. millionaire wanted just one Bitcoin, there wouldn’t be enough to go around.
✅ Geopolitical risks, rising debt, and institutional adoption could drive Bitcoin’s long-term value.
✅ Regulatory clarity might unlock more institutional investment and price stability.

The Bigger Picture: Bitcoin’s Future in Institutional Portfolios 🏛️📈

📌 BlackRock argues Bitcoin is a key asset for diversification, especially in a world facing inflation and fiscal instability.
📌 While short-term volatility remains, Bitcoin’s decentralized nature and fixed supply make it a compelling hedge.
📌 Institutional players are watching closely—will they buy the dip or wait for more regulation?

TL;DR: Bitcoin ETF Sees Record Volume, BlackRock Remains Bullish on Scarcity 🔥💰

IBIT’s trading volume hit record highs, but the fund lost over $1B amid an 11% price drop.
Bitcoin’s real supply is tighter than expected, with 3-4M coins lost forever.
BlackRock sees regulation and institutional adoption as key to Bitcoin’s long-term growth.
Despite short-term bearish sentiment, Bitcoin’s scarcity narrative remains strong.

Will institutions buy into the dip, or is this just the start of a bigger market shake-up? 🤔