BlackRock says Bitcoin volatility fell to 35‑40 as ETFs gain financial utility

BlackRock’s Jay Jacobs told the Pomp Podcast that Bitcoin’s volatility has dropped from roughly 80 to the 35‑40 range. He linked the decline to broader participation in BlackRock’s crypto exchange‑traded products (ETPs), the expansion of Bitcoin‑linked options, deeper market liquidity and a growing base of long‑term holders.

ETPs as financial tools for large Bitcoin holders

According to Jacobs, large investors are increasingly using BlackRock’s iShares Bitcoin Trust (IBIT) and related products as a way to place Bitcoin exposure inside conventional financial accounts. This enables them to pledge ETF shares as collateral for loans, access options for hedging or income, and manage portfolio risk without selling the underlying asset.

In‑kind creation and redemption

The SEC approved in‑kind creation and redemption for authorized participants of crypto ETPs in July 2025, allowing large baskets of Bitcoin to be exchanged for IBIT shares. Jacobs noted that the current creation basket is valued at about $1.7 million and contains roughly 22.65 BTC, close to the $1.5 million threshold he mentioned on the podcast.

Product lineup and assets under management

• IBIT – spot Bitcoin exposure, tracking the CME CF Bitcoin Reference Rate‑New York Variant, with about $59.87 billion in net assets as of Sept. 17.
• BITA – a Bitcoin premium income ETF that writes covered call options on IBIT, targeting 25‑35 % of the portfolio, with a 13.25 % distribution rate reported on Sept. 9.
• ETHA – spot Ethereum exposure.
• ETHB – an Ethereum ETP that combines price exposure with staking rewards, holding just over $1 billion in net assets and offering a 1.54 % 30‑day staking reward rate.

Implications for volatility

Jacobs cautioned that the lower volatility figure is not a guarantee of future stability. He said that while deeper liquidity and diversified participants can dampen price swings, sharp moves can still occur, especially when derivatives or leverage amplify market dynamics.

Broader strategic view

BlackRock sees the financialization of Bitcoin – the ability to use the asset for collateral, hedging and income generation – as a key factor in its growing crypto strategy, which remains focused on Bitcoin and Ethereum as the two largest digital assets by market cap.