BlackRock’s bull case for bitcoin access among retail investors

It could be the year Main Street’s appetite for cryptocurrency exposure meaningfully grows.

Although it’s been two years since the first spot bitcoin ETFs began trading on U.S. exchanges, BlackRock’s Jay Jacobs thinks they’re a fairly new concept.

“It’s still so early,” the firm’s U.S. head of equity ETFs told CNBC’s “ETF Edge” this week. “Many investors have still just been starting their educational journey around what is bitcoin, [and] how might it fit in a portfolio .… We see this still being very early days for bitcoin and ethereum.”

BlackRock manages iShares Bitcoin Trust ETF (IBIT) and iShares Ethereum Trust ETF (ETHA). As of Thursday’s market close, IBIT is down more than 3% in the past year. The weakness comes after bitcoin prices hit a record high of around $126,000 last October. It’s now trading in the low $90,000 range.

Meanwhile, ETHA is lower by almost 6%.

Cryptocurrencies have gained a lot of traction recently, and part of what’s driving that is the fact that large-scale asset managers including BlackRock have expanded options for traders to invest in them, using equity-like formats, including ETFs.

“For many financial advisors, maybe they didn’t have access to crypto before, or weren’t able to buy IBIT before it was approved on their platforms,” Jacobs said.

But for those who have taken the plunge, VettaFi’s Todd Rosenbluth says the asset class is instilling a sense of loyalty — despite bouts of volatility.

“They’re sticking with it, not necessarily selling out and looking for another alternative so quickly,” Rosenbluth told CNBC in the same interview.

Rosenbluth finds crypto investors are basically staying put despite the uncertainty.

“It shows that investors that are moving into getting exposure to cryptocurrency through the ETF wrapper have some loyalty to the product, have confidence in the long-term trends,” Rosenbluth said. “They’re not necessarily moving in or moving out based on that volatility.”