- Larry Fink says Bitcoin shouldn’t be a large part of investors’ portfolios.
- BlackRock’s Bitcoin exchange-traded fund has about $90 billion in assets.
- The fund dominated the competition last week with $3.5 billion in inflows.
Buy Bitcoin — but don’t get carried away.
That’s the message from BlackRock CEO Larry Fink, the man who once called Bitcoin “the domain of money launderers and thieves.”
On Monday, he told CBS’s 60 Minutes the asset now has a place in investor portfolios.
Just not a big one.
“There’s a place for bitcoin much like gold — it’s an alternative. For those that are looking to diversify their portfolio, this isn’t a bad asset,” Fink said.
He doesn’t believe, however, that it “should be a large component of your portfolio.” The comment mirrors how Wall Street has historically viewed gold: a useful diversifier and hedge, but never a core allocation.
Indeed, Wall Street has long-preached the gospel of diversification through a traditional 60/40 portfolio — 60% stocks for growth, 40% bonds for stability.
The model worked for decades, delivering steady returns while cushioning crashes.
But as correlations between stocks and bonds have broken down in recent years, compressing returns, institutional investors are searching for new sources of diversification.
That’s when alternative assets like Bitcoin come into play.
$90 billion
Despite Fink’s caution, BlackRock’s Bitcoin ETF has become one of the most successful fund launches in history.
Less than two years since its debut, the firm’s IBIT fund already holds over $90 billion in assets under management.
Moreover, IBIT led all ETF flows across every sector last week, pulling in $3.5 billion, or about 10% of all net flows into ETFs. That beat Vanguard’s SPLG and State Street’s VOO, stalwart S&P 500 trackers that have been around for 20 and 15 years, respectively.
“That”s how hungry the fish are,” Eric Balchunas, a Bloomberg Intelligence ETF analyst, said on X. “Enjoy while it lasts.”
Still, that $90 billion figure is down from $98 billion last week, after Bitcoin’s value fell amid a record $19 billion leverage crash.
Make it 40%
Other traditional finance titans have gone a bit further.
Back in June, Ric Edelman, the famed financial advisor of Edelman Financial Engines, which manages $287 billion for 1.3 million clients, made a huge call on crypto.
Edelman said that conservative investors should allocate 10% to digital assets. He also recommended that moderate investors assign 25% to the nascent instruments, and aggressive investors a staggering 40%.
“Today I am saying 40%, that’s astonishing,” he said on CNBC on June 27. “No one has ever said such a thing.”
US government shutdown
Fink’s words come at a time of broad economic turmoil — much like the last time BlackRock executives were in the press telling investors to buy Bitcoin.
Back in April, Samara Cohen, BlackRock’s CIO of ETF and Index Investments said that crypto-curious institutions really only cared for Bitcoin.
“Especially in this environment,” Cohen told the Blockworks Empire podcast.
What was that environment? A global trade war and uncertainty around Federal Reserve Policy.
This time is no different. Last Thursday, a tug-of-war between the US and China sent crypto markets tumbling, setting off a $19 billion liquidation event.
Nowadays, macro uncertainty is compounded as the US suffers through its second week of a government shutdown. The funding impasse has delayed the release of key economic data the Federal Reserve relies on for policy decisions, including monthly jobs reports and inflation data.
Without official statistics, markets are flying blind on the health of the economy.
Against this backdrop, Bitcoin’s narrative as a hedge against government chaos has gained traction with institutional investors searching for alternatives to traditional markets.
Fink’s measured endorsement reflects this shift — Bitcoin is legitimate enough for diversification, but Wall Street’s old guard isn’t ready to bet the farm on it just yet.
Pedro Solimano is DL News’ Buenos Aires-based markets correspondent. Got a tip? Email him at psolimano@dlnews.com.
