By
Bhushan Akolkar
May 10th, 2024
The success of the BlackRock iShares Bitcoin Trust IBIT in the United States serves as a testament to the growing appetite for crypto investment products.
BlackRock Inc (NYSE: BLK), the world’s largest asset manager, has announced its partnership with B3, the Brazilian stock exchange operator, to launch a Bitcoin Exchange-Traded Fund (ETF) in Brazil. This development highlights the growing acceptance and integration of cryptocurrencies into mainstream investment portfolios.
Key Features of BlackRock’s IBT39
The ETF, named IBT39, is a Brazilian Depositary Receipt (BDR) of the iShares Bitcoin Trust ETF, originally launched in the United States in January. However, what sets it apart is that its shares are issued and traded in Brazil.
This launch marks BlackRock’s debut in the Brazilian crypto ETF market and is set to commence trading Today, March 1st. Notably, it will be available to both qualified investors and retail investors, making it accessible to a broader spectrum of the investing community.
Karina Saade, President of BlackRock in Brazil, articulated the importance of this move, stating, “Our digital asset journey has been underpinned by the goal of providing high-quality access vehicles to investors. IBIT39 is a natural progression of our efforts over many years and builds on the fundamental capabilities we have established so far in the digital asset market.”
“This is another opportunity for investors to include exposure to Bitcoin in their portfolios,” added Felipe Gonçalves, Superintendent of Interest and Currency Products at B3.
The ETF carries a management fee of 0.25%, with a one-year waiver reducing the fee to 0.12% on the first $5 billion Assets Under Management (AUM). As a Brazilian Depositary Receipt, the ETF is taxed similarly to shares. It is crucial to remember, however, that BDRs, unlike certain stock exchange transactions, are not tax-free. Additionally, the Brazilian fund will be open to investors who have already invested at least 1 million reals ($201,000) in the market.
Despite the excitement surrounding the launch of IBT39, retail sales are pending approval by BlackRock Brazil. However, the anticipation among investors is palpable, given the growing interest in cryptocurrencies globally and the increasing demand for investment vehicles that provide exposure to digital assets.
The introduction of IBT39 adds to the existing array of ETFs with crypto exposure listed on B3, which began listing in 2021. These ETFs, totaling 13 in number with a combined value of 2.5 billion reals, have garnered remarkable attention from investors, reflecting the evolving ecosystem of investment preferences in Brazil.
BlackRock’s Bitcoin ETF Success
The success of the BlackRock iShares Bitcoin Trust IBIT in the United States serves as a testament to the growing appetite for crypto investment products.
Approved by the United States Securities and Exchange Commission (SEC) alongside ten others, the fund quickly amassed $2 billion in AUM within two weeks of its launch. Currently, the BlackRock ETF boasts over $8 billion in AUM, underscoring its popularity among investors seeking exposure to Bitcoin.
Looking ahead, BlackRock is exploring further opportunities in Brazil’s crypto market, with reports indicating a potential launch of a spot Ethereum (ETH) ETF contingent on SEC approval in the United States.