Blackstone Takes Cautious Step into Bitcoin with BlackRock ETF Investment

On May 20, 2025, Blackstone, the world’s largest alternative asset manager with over $1 trillion in assets under management, disclosed its first-ever investment in cryptocurrency through its Alternative Multi-Strategy Fund. The firm acquired 23,094 shares of BlackRock’s iShares Bitcoin Trust (IBIT), a spot Bitcoin exchange-traded fund (ETF), valued at approximately $1.08 million as of March 31, 2025. This move, while modest relative to Blackstone’s vast portfolio, marks a significant milestone in the institutional adoption of Bitcoin and reflects a cautious but notable shift in traditional finance’s approach to digital assets.

A Small but Symbolic Investment

Blackstone’s investment in IBIT represents a tiny fraction—less than 0.01%—of its $1 trillion asset portfolio. The BlackRock iShares Bitcoin Trust, launched in January 2024, has grown to manage over $60 billion in assets, making it one of the largest spot Bitcoin ETFs globally. Blackstone’s $1.08 million allocation, disclosed in a recent SEC filing, underscores a conservative entry into the crypto market, aligning with the firm’s reputation for prudent and calculated investment strategies.

The decision to invest in IBIT, rather than directly holding Bitcoin or other cryptocurrencies, suggests Blackstone is prioritizing regulated and liquid exposure to digital assets. Spot Bitcoin ETFs like IBIT allow institutional investors to gain exposure to Bitcoin’s price movements without the complexities of direct custody, such as managing private keys or navigating unregulated crypto exchanges. This approach mirrors the growing trend among traditional financial institutions, with firms like Goldman Sachs and JPMorgan also exploring crypto-linked products through ETFs and structured notes.

Bitcoin’s Institutional Appeal Grows

As of the press time on May 21, Bitcoin was trading at $106,702, with a total market capitalization of $2.1 trillion. Since the U.S. approved spot Bitcoin ETFs in January 2024, institutional interest in Bitcoin has remained resilient. According to CoinGlass, as of May 21, these ETFs have collectively attracted $127.18 billion in inflows. Among them, BlackRock’s iShares Bitcoin Trust (IBIT) holds 636,120.49 BTC, valued at $67.89 billion.

Blackstone’s investment comes amid a wave of institutional Bitcoin adoption. Data from HODL15Capital shows that, as of May 19, the top 85 companies collectively held over 800,000 BTC, representing 1/30th of Bitcoin’s 21 million total supply and 4.02% of the 19,867,587 BTC in circulating supply. Notably, Strategy alone holds 576,230 BTC, valued at $61.5 billion.

Context of Blackstone’s Move

Blackstone’s cautious entry into Bitcoin aligns with its broader investment philosophy, which emphasizes diversification and risk management. The Alternative Multi-Strategy Fund, which made the IBIT purchase, is designed to allocate capital across a range of asset classes, including hedge funds, private equity, and real estate. The inclusion of Bitcoin exposure, even at a minimal level, suggests Blackstone is testing the waters in response to growing client demand for alternative assets with high growth potential.

Blackstone has historically been cautious about investing in Bitcoin and other cryptocurrencies. According to The Block, as early as 2019, Blackstone’s co-founder and CEO Stephen Schwarzman stated he was not interested in Bitcoin investments, citing its complexity as difficult to understand.

Regarding this Bitcoin investment, some view it as a bullish signal for Bitcoin’s mainstream acceptance. However, others argue that the investment’s small scale raises questions about whether it reflects genuine conviction or is merely a symbolic gesture to appease crypto-curious clients.

Regardless of Blackstone’s motives for this cautious Bitcoin investment, it sends a clear signal: demand for Bitcoin among traditional investors is rising. Even at a small scale, Blackstone’s move indicates to other traditional asset managers that Bitcoin is a viable asset class worth exploring.