{"id":210641,"date":"2026-09-01T23:23:10","date_gmt":"2026-09-01T23:23:10","guid":{"rendered":"https:\/\/www.europesays.com\/people\/210641\/"},"modified":"2026-09-01T23:23:10","modified_gmt":"2026-09-01T23:23:10","slug":"larry-finks-bitcoin-reversal-and-blackrocks-59b-etf","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/people\/210641\/","title":{"rendered":"Larry Fink\u2019s Bitcoin Reversal and BlackRock\u2019s $59B ETF"},"content":{"rendered":"

\t\t\t\t\"\"CEO of BlackRock Larry Fink speaks during a panel at the BlackRock Infrastructure Summit on March 11, 2026, in Washington, DC. Photo by Anna Moneymaker\/Getty Images<\/p>\n

In October 2017, Larry Fink<\/a> stood before a banking-industry audience and reduced bitcoin to five words: \u201can index of money laundering.<\/a>\u201d The BlackRock<\/a> CEO has had plenty of company over the years. Warren Buffett<\/a> told CNBC the decentralized digital currency was \u201cprobably rat poison squared<\/a>\u201d; JPMorgan Chase CEO Jamie Dimon<\/a> called bitcoin a nonproductive \u201cpet rock<\/a>\u201d; Nobel laureate economist Eugene Fama<\/a> said the odds of bitcoin going to zero within a decade were \u201cclose to one<\/a>\u201d on the Capitalisn\u2019t podcast.\u00a0Fink now calls bitcoin \u201cdigital gold.<\/a>\u201d\u00a0<\/p>\n

It\u2019s a pretty stark pivot\u2014until you look at the cash bitcoin funds are taking in. By the end of August, bitcoin traded near $78,000<\/a>, U.S. bitcoin funds just closed their best month of 2026<\/a> with about $3.3 billion in fresh money, and the group\u2019s combined assets briefly topped $100 billion<\/a> for the first time. Roughly three of every four of those new dollars ran through one product: BlackRock\u2019s iShares Bitcoin Trust (ticker: IBIT).<\/p>\n

The plainest wrapper in finance<\/p>\n

In June 2023, BlackRock\u2014the world\u2019s largest asset manager, now overseeing a record $15.3 trillion<\/a>\u2014filed for an exchange-traded fund to hold actual bitcoin. The Securities and Exchange Commission approved it the following January, only after a federal appeals court ruled against the agency in a challenge brought by Grayscale<\/a> that effectively forced the SEC\u2019s hand. In short, Fink took one of the most volatile assets, sealed it inside the plainest wrapper in finance, and gave top institutions a way to buy in without ever touching crypto itself<\/a>. The day after trading started, Fink told CNBC<\/a> the ETFs were \u201cstep one in the technological revolution in the financial markets,\u201d with tokenizing \u201cevery financial asset\u201d as step two. By the time 60 Minutes sat Fink down last October<\/a>, he framed his evolution on the subject as a response to market reality. Fink told Lesley Stahl that \u201cthe markets teach you, you have to always relook at your assumptions.\u201d\u00a0<\/p>\n

That plain wrapper now holds about $59 billion<\/a>, well over half of everything sitting in U.S. bitcoin funds combined\u2014and its share is still climbing, capturing 75 percent of all new cash flowing into this sector. BlackRock charges 0.25 percent a year, which comes out to $25 on every $10,000 invested, generating roughly $148 million a year in revenue from a single $59 billion fund.<\/p>\n

BlackRock\u2019s advice to clients is restraint, recommending a 1 to 2 percent slice of a portfolio, carved out of stocks. The firm re-ran the strategy\u2019s math in an Aug. 17 paper, \u201cRe-Underwriting Bitcoin,<\/a>\u201d whose 10-year back-test asks what would have happened if a standard retirement portfolio\u2014split between 60 percent stocks and 40 percent bonds\u2014had held that small slice of bitcoin the whole time. BlackRock\u2019s answer is that the portfolio would have earned a bit more without taking on much more risk. The exercise is hypothetical and built entirely on hindsight, and it comes from the people selling the fund. But it is also the argument institutions are hearing.<\/p>\n

The foil is Vanguard<\/a>, the rival index giant, which spent 2024 calling crypto assets \u201cspeculative and highly volatile.<\/a>\u201d Then, last December, Vanguard opened its platform<\/a> to allow clients to trade third-party bitcoin funds under a new CEO, Salim Ramji<\/a>, who came from Fink\u2019s shop and helped launch this exact fund. Even with the change, Vanguard\u2019s Global Head of Quantitative Equity, John Ameriks<\/a>, likened bitcoin to a \u201cdigital Labubu<\/a>\u201d\u2014a collectible toy craze and crash in the Beanie Babies mold<\/a>\u2014at a Bloomberg<\/a> industry conference in New York, because, he said, the coin generates no income.\u00a0<\/p>\n

Vanguard still sells no bitcoin product of its own; it just stopped standing in the way of customers buying other providers\u2019 products. And it has no plans to change that, the company told Observer, because it focuses on \u201cproducts that generate cash flow in a transparent way, such as interest payments and dividends.\u201d\u00a0<\/p>\n

Breaking the August curse\u00a0\u00a0<\/p>\n

For most of 2026, the money was slipping away\u2014outflows, in industry-speak\u2014the worst stretch of net withdrawals these bitcoin ETFs have had since launching, with about $5.4 billion walking out<\/a> in the first half as investors pulled away.\u00a0August broke the pattern, which is not the month anyone would have picked. Traders call it the August curse<\/a>. The coin closed the month red in nine of the last 13 years<\/a>, by CoinGlass\u2019s count, including every August from 2022 through 2025, a slump usually blamed on thin summer trading while financial desks sit half-staffed. Days before this one began, the chart analyst Ali Martinez<\/a> posted the four-year streak on X<\/a> and asked whether this August would break the trend. It did: Bitcoin climbed roughly a quarter last month on its run toward $80,000<\/a>. Yesterday\u2019s close marks bitcoin\u2019s best August since 2017.<\/a>\u00a0<\/p>\n

The difference this year was that the desks never seemed to empty; money kept flowing into the ETFs through the dead weeks of summer. An Aug. 19 announcement from the Treasury<\/a> Department that it would double the pace at which it buys back its own long-term debt gave traders reason to expect more dollars sloshing around. Eric Balchunas<\/a>, senior ETF analyst at Bloomberg Intelligence, called the mood the \u201cdebasement trade\u201d in a post on X<\/a>, shorthand for the bet that the government will keep watering down the dollar<\/a>, so investors are buying the two things it can\u2019t make more of. According to Balchunas, gold and bitcoin funds combined for a record $7 billion over five trading days.\u00a0<\/p>\n

During the week of Aug. 17 alone, bitcoin funds drew $1.92 billion<\/a>, the most since last October, with $1.33 billion of it moving through Fink\u2019s fund, figures BlackRock confirmed for Observer. More than half the month\u2019s inflows arrived in those five days. Even with an August rebound, the whole year is a seesaw that still tips toward losses, with the funds about $2.5 billion in the red<\/a>.<\/p>\n

The turnaround week opened, as it happens, on the same Monday that BlackRock published its paper (Aug. 17), which blames the ugly stretch on money chasing A.I. instead. Since last October, by its count, more than $46 billion moved into A.I.-themed funds while bitcoin funds bled, \u201ccyclical flow dynamics rather than indicators of a structural shift,\u201d in the paper\u2019s words. The two are less enemies than rivals for the same dollar, and they tell opposite stories about the future. A.I. is the wager that everything goes right. Bitcoin, in Fink\u2019s own telling, is what you buy when you fear it won\u2019t<\/a>.<\/p>\n

So are August 2026\u2019s crypto gains durable money or a snap-back? Both, according to Andr\u00e9 Dragosch<\/a>, head of research for Europe at Bitwise, a competing crypto asset manager. The slow money drips in from institutions that set a long-term bitcoin target and buy toward it, \u201cprobably rather price agnostic in the short term,\u201d as he put it in a message. The fast money floods\u2014retail traders and hedge funds chasing the move. Nobody can cleanly split the two, but Bitwise\u2019s own institutional contacts, he said, have been buying through the spike, and by the firm\u2019s research<\/a>, flows feed on themselves. \u201cThese flows tend to be very persistent,\u201d he said.<\/p>\n

BlackRock and Bitwise both call the bad stretch cyclical\u2014and both get paid when money flows in, collecting fees as their fund assets grow.\u00a0<\/p>\n

The slowest money of all sits in retirement accounts. In August 2025, President Donald Trump<\/a> signed an executive order<\/a> directing the Labor Department to open 401(k) plans to alternative assets, crypto included, and the department proposed its rule<\/a> in March. An executive order tells federal agencies what to do, but by itself, it does not place digital assets in anyone\u2019s account. While BlackRock has stopped short of offering a direct crypto 401(k), it is expanding alternative retirement options by launching a private markets fund <\/a>this year. Consumer advocacy groups have pushed back against expanding alternative asset access in pensions: Benjamin Schiffrin<\/a>, director of securities policy at Better Markets, criticized private and digital assets in retirement plans as \u201cticking time bombs in tens of millions of retirement accounts<\/a>.\u201d In January, Sen. Elizabeth Warren<\/a>, a Democrat from Massachusetts, pressed the SEC to clarify how securities rules will protect investors from high-risk assets under the administration\u2019s retirement push, writing that a 401(k) is \u201ca lifeline to retirement security rather than a playground for financial risk.<\/a>\u201d<\/p>\n

Fink answered the risk question before this fight escalated. \u201cBut, they are risky. Aren\u2019t they?\u201d Stahl pressed him on the same 60 Minutes segment. \u201cYes,\u201d he said. \u201cBut everything is risky other than keeping your money in a bank account overnight.\u201d Fink\u2019s annual chairman\u2019s letter<\/a>, published in March, sketches where he wants this to go. Half the world already carries a digital wallet, and he imagines that more widespread adoption will allow individuals to invest from them as easily as they transfer money.<\/p>\n

So did Fink legitimize bitcoin, or just find a more palatable way to package it?\u00a0<\/p>\n

\u201cBlackRock and others such as Bitwise simply found a new on-ramp to increase adoption,\u201d Dragosch told Observer\u2014people buy through vehicles they already know rather than learning to hold the coin themselves. The road runs both directions: Wall Street is adopting the technology <\/a>underneath the coin even as bitcoin gets wrapped in Wall Street\u2019s products. \u201cThere is a convergence of these two worlds happening from both sides simultaneously,\u201d he said. Fink\u2019s step two, seen from the outside.<\/p>\n

Asked about that framing, BlackRock confirmed the fund figures on a call and did not contest the skeptic-to-champion arc. It disputed one thing: that owning the fund means institutions no longer need to understand crypto. A spokesperson declined to comment further.\u00a0<\/p>\n

Nearly nine years after \u201can index of money laundering,\u201d the man who packaged bitcoin for Wall Street\u2019s cautious crypto adopters keeps one caveat on the label, and it is the caveat the skeptics started with: You still have to know what\u2019s inside. And inside is the underlying investment\u2014the same coin that swung sharply before its latest run, falling from a high of nearly $74,000 to under $50,000 <\/a>before rebounding.\u00a0\u00a0<\/p>\n

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