BNP Paribas, Europe’s second largest bank, holds a modest amount of spot Bitcoin ETFs. The bank acquired 1,030 units of BlackRock’s iShares Bitcoin Trust (IBIT), representing an investment of approximately $41,684, according to a 13F filing by the company.
While the investment may seem small given the bank’s broad portfolio of $600 billion in assets under management (AUM), it is an important initial step as the company looks to invest in Bitcoin (BTC).
The bank’s journey into the cryptocurrency space began in 2022 with a partnership with Metaco to develop a cryptocurrency custody service that facilitates the issuance, transfer and secure storage of regulated digital assets for customers.
Since then, BNP Paribas has invested strategically in the industry to support startups in the rapidly growing digital economy.
Notably, the bank, along with Goldman Sachs, led a sizeable $100 million investment round in Fnality International last year. Fnality International specializes in utilizing blockchain technology for safe and efficient cash transfers between financial institutions.
Paribas’ recent investment in a spot Bitcoin ETF is consistent with the current decline in fund adoption by institutions. Total outflows from the investment vehicle reached $563.7 million on Thursday, the highest in a single day since its inception in January.
Fidelity’s FBTC led the way with more than $191 million leaving the fund, followed closely by Grayscale’s GBTC with $167.3 million in net outflows.
Institutional Debate over Bitcoin ETFs
The low institutional adoption of Bitcoin ETFs has sparked significant discussion within the cryptocurrency community about X. Jim Bianco of Bianco Research believes institutional investors are hesitant to invest in Bitcoin ETFs due to lack of attractiveness.
Eric Balchunas, senior ETF analyst at Bloomberg, disputed Bianco’s view and said he expects such products to be widely adopted once investment advisers begin reporting their 13F filings this month.
Balchunas emphasized that about 150 advisors across the country have already reported owning physical ETFs, although the majority of 13Fs have not yet been filed.
“The majority of 13Fs have not yet participated, with 150 advisors (from across the country) reporting that they already own physical ETFs,” he wrote to X.
He expects a surge in institutional advisors choosing Bitcoin ETFs, with more than 500 advisors expected to report their ownership by May 15.
Balchunas predicts that this heightened interest among advisors will set new records for the market’s first three months and mark a potential tipping point for institutional adoption of Bitcoin ETFs.
next