BlackRock Adds Its Spot Bitcoin ETF to Model Portfolio

According to Bloomberg, BlackRock plans to allocate 1% to 2% of its model portfolio assets to IBIT. As of February 28, the Bitcoin holdings under IBIT’s management have surpassed $48 billion.

This allocation takes into account Bitcoin’s high volatility, with its price dropping from a peak of around $110,000 to approximately $83,000. The decision to adjust model portfolios reflects the need to adapt to changing market conditions and enhance diversification within traditional investment strategies.

Notably, this move follows a period of significant net outflows from the U.S. spot Bitcoin ETF market, totaling billions of dollars in recent days. Between February 25 and 27 alone, net outflows exceeded $2 billion, according to SoSoValue.

Related: Bitcoin ETFs Face Historic Sell-Off—$938M Pulled in a Day

We believe Bitcoin has long-term investment merit and can potentially provide unique and additive sources of diversification to portfolios,

said Michael Gates, BlackRock's head of model portfolio solutions, emphasizing the cryptocurrency’s long-term investment potential.

Eve Cout, head of portfolio design and solutions for US Wealth at BlackRock, added: “They all want to allocate more to alternatives, but they need guidance on how to size, scale, and rebalance the position.” His statement highlights the need for a structured methodology to determine optimal portfolio allocations.

This decision comes amid a broader decline in market sentiment toward cryptocurrencies, as investors grow increasingly cautious due to rising economic uncertainty and escalating trade tensions.

Related: Bitcoin Is Down, But Are There Any Sellers Left?

Model portfolios, managing approximately $150 billion in assets, are widely used to build balanced investment strategies. Even small adjustments to their composition can lead to large-scale capital movements.

BlackRock’s decision highlights a measured approach to risk and opportunity management, where innovative tools like IBIT are gradually integrated into established financial models. This evolution enhances portfolio diversification, offering investors new layers of exposure to digital assets.