BlackRock Is Pulling Bitcoin Whales Into Wall St's Orbit

Watch BlackRock Is Pulling Bitcoin Whales Into Wall St's Orbit - Bloomberg on Dailymotion

Transcript

00:00Big Bitcoin holders are using a new generation of ETFs to transfer their wealth off the blockchain

00:04without selling. Bloomberg's Emily Grafea reported on these in-kind transactions and she joins us now.

00:09How are they doing it? So the SEC approved in-kind transactions and spot Bitcoin ETFs back in the

00:16summer. This is a kind of transaction that happens in most ETFs. But basically we spoke to asset

00:22managers that have these ETFs that are saying that high net worth investors are coming to them

00:27saying, I made a ton of money in Bitcoin. I want to bring it into the regulated financial system.

00:33So what they're doing is they're taking their Bitcoin and they're giving it to the ETF.

00:36They're getting back shares of a Bitcoin ETF in return that then they can use for lending,

00:42collateral, margin, because it's an ETF as opposed to Bitcoin holdings that they had like in a cold

00:48wallet. So TradFi to the rescue again. Yeah, it's pretty circular here. BlackRock said that they've

00:53already facilitated more than three billion of these transactions. Bitwise said they're getting

00:58calls basically every day for investors looking to do this. And sometimes it's someone looking to take

01:04all of their Bitcoin holdings and move it to the ETF. Sometimes it's someone just looking for maybe 20%

01:09of what they own. Just 10 seconds. Why are the ETFs popular for this? Because you can make this change

01:16what we believe to be tax-free because there's no selling involved. So you can kind of move into this ETF

01:22and you don't have to actually sell your Bitcoin holdings. You just kind of swap them.