Bitcoin: One of Europe's largest banks invests in BlackRock's ETF!

The day of May 1, 2024 will be etched in memories as one of the most tumultuous for the crypto sector. Indeed, it was on this day that Bitcoin ETFs experienced massive and historic outflows of $563.7 million. However, amidst the turmoil, a ray of hope pierced the clouds with the decision of BNP Paribas, the second largest European bank, to take the leap in adopting Bitcoin.

BNP Paribas’ Highly Symbolic Entry

The verdict on Bitcoin spot ETFs came down on this May 1st, a day now dubbed “dark” for these instruments. An astonishing amount of $563.7 million left these funds in just 24 hours, setting an absolute daily outflow record since their inception.

In this restless context, BNP Paribas, the second-largest European bank with more than $600 billion in assets under management, has officially joined the Bitcoin adoption movement. According to recent 13F filings, the institution has acquired a stake of about $40,000 in BlackRock’s IBIT.

While modest, this investment carries significant symbolic importance. Indeed, it marks the entry of a major player in European traditional finance onto the cryptocurrency scene, an unprecedented validation of their legitimacy.

Institutional Validation of Bitcoin Underway

The adoption of Bitcoin by BNP Paribas represents a further advance in the validation by institutions of Bitcoin as a viable asset class. Up to now, mainly American asset managers, family offices, and regional banks had joined the movement.

If other major banks and asset managers also reveal Bitcoin allocations in their upcoming 13F filings, the institutional acceptance of Bitcoin will reach a new level. A dynamic that could in turn stimulate the general public’s appetite and massive inflows into ETFs and other regulated vehicles.

Despite the shock of the record outflows that rocked the Bitcoin ETFs on May 1st, BNP Paribas’ symbolic investment in such funds represents a new milestone in the institutional adoption of the leading cryptocurrency. As more heavyweights of the traditional financial sector follow the example of the European bank, the legitimacy and attractiveness of Bitcoin as an asset class will continue to grow.