BlackRock, a giant in the investment world, is diving headfirst into digital assets. But they’re seeing a big difference between Bitcoin and Ethereum when it comes to institutional investors.
Bitcoin’s Big Lead
According to Samara Cohen, BlackRock’s Chief Investment Officer for ETFs and Index Investments, client demand for Bitcoin is far outpacing Ethereum. Their hugely successful Bitcoin ETF launch (IBIT) shows this clearly. It was the fastest-selling ETF ever! Cohen says this success is due to a combination of investor demand, market readiness, and regulatory developments. But the core reason was investors wanting Bitcoin in their portfolios.
BlackRock’s journey with Bitcoin started earlier, with a private Bitcoin trust for institutional clients in 2022. This helped them get comfortable with the technology and risk management before going public. Surprisingly, half of IBIT’s investors are individual investors who were new to ETFs—they bought IBIT specifically to get Bitcoin exposure.
Ethereum Lags Behind
The story is quite different for Ethereum. While BlackRock does offer Ethereum-based ETFs, the demand is significantly lower. Cohen explains that institutions are struggling to figure out how Ethereum’s value will grow. Unlike Bitcoin’s relatively simple “store of value” narrative, Ethereum’s value proposition is much more complex, involving technology, token economics, competition, and future market trends.
The Data Problem
Another hurdle is the lack of standardized data and metrics in the crypto world. Cohen points out that essential information like cash flow, governance, and team transparency—common in traditional markets—is often missing or unreliable in crypto. This makes it hard to create proper indexes and valuation models. Bitcoin, on the other hand, has clearer metrics around scarcity and market infrastructure, making it easier to integrate into traditional portfolios.
BlackRock’s Recommendation
BlackRock suggests a 1-2% Bitcoin allocation for investors. Going beyond that increases portfolio volatility significantly. Although Ethereum is advancing technologically, institutions need clearer valuation models and standardized data before investing heavily. In short, Ethereum’s complexity is currently hindering its institutional adoption compared to Bitcoin’s simpler value proposition.
