Blackstone buys $1M worth of Bitcoin ETF in first crypto bet

Blackstone, the world’s largest alternative asset manager, recently made its first foray into the cryptocurrency market. A May 20 SEC filing revealed a relatively small investment totaling approximately $1.08 million. This represents a minuscule portion of their $1.2 trillion portfolio. The investment comprised 23,094 shares of BlackRock’s iShares Bitcoin Trust ETF (IBIT), added to Blackstone’s Alternative Multi-Strategy Fund (BTMIX), which holds $2.63 billion in assets. Additionally, Blackstone purchased 4,300 shares of Bitcoin Depot Inc. (BTM) for $6,300 and 9,889 shares of the ProShares Bitcoin ETF (BITO) for $181,166.

This move contrasts with Blackstone’s previously expressed reservations about crypto. In 2019, CEO Steve Schwarzman acknowledged blockchain’s potential but voiced skepticism about its use as currency, citing a preference for controlled monetary systems and a lack of understanding of the technology. Blackstone’s vast investment portfolio spans private equity, real estate, credit, infrastructure, hedge funds, and insurance solutions. As of March 31, they reported $37 billion in investable capital.

In contrast to Blackstone’s cautious entry, the Wisconsin Investment Board, an early adopter of Bitcoin exposure for US retirees, recently liquidated its entire IBIT holding of 6,060,351 shares, valued at $3.7 billion, during the first quarter.

BlackRock’s IBIT, however, continues to see significant inflows. Data from Farside Investors shows a 20-trading-day streak of inflows, totaling over $46.1 billion since its January 2024 launch, with no outflows since April 9. This surpasses the all-time net inflows of other Bitcoin ETFs like Fidelity Wise Origin Bitcoin Fund (FBTC) at $11.8 billion and ARK 21Shares Bitcoin ETF (ARK) at $2.8 billion.

The contrasting approaches of Blackstone and the Wisconsin Investment Board highlight the diverse strategies employed by institutional investors navigating the evolving cryptocurrency landscape. Blackstone’s modest entry suggests a tentative approach, while the Wisconsin Investment Board’s complete divestment indicates a different risk assessment and strategic shift. The sustained inflows into BlackRock’s IBIT, however, point to a broader trend of growing institutional interest in Bitcoin.