Higher Costs, Greater Profits: BlackRock’s Crypto ETFs Surpass Conventional Funds

BlackRock’s

and ETFs have brought in more than $260 million in yearly revenue over a two-year span, signaling a notable transformation in the company’s investment approach. The iShares Bitcoin Trust (IBIT) generated $218 million in its debut year, while the Ethereum-focused fund (ETHA) contributed $42 million, based on data from Omar Kanji at Dragonfly. These numbers emphasize how quickly both institutional and individual investors are embracing crypto assets. IBIT’s 0.25% fee—higher than BlackRock’s traditional ETFs such as the iShares Core S&P 500 ETF (IVV)—has fueled impressive revenue growth, even though it manages a smaller pool of assets. Together, these funds now oversee assets exceeding $100 billion, highlighting BlackRock’s decisive move into digital assets.

The strong performance of these ETFs demonstrates a growing appetite among investors for cryptocurrency exposure, which commands higher fees than standard investment products. While

and each levy a 0.25% annual fee, BlackRock’s main equity ETFs typically charge between 0.03% and 0.1%. This gap highlights the unique value investors see in Bitcoin and Ethereum as alternative assets. Since its January 2024 launch, IBIT has drawn $60.6 billion in net inflows, accounting for nearly three-quarters of all U.S. Bitcoin ETF investments, while ETHA, which began in July 2024, has secured 72.5% of Ethereum ETF inflows with $13.4 billion in assets. Their dominance also plays a key role in establishing crypto as a legitimate, regulated investment option.

These ETFs have also surpassed BlackRock’s flagship S&P 500 fund in terms of revenue. According to Bloomberg, IBIT’s annual fees reached $187.2 million as of July 2025, just edging out IVV’s $187.1 million, despite IBIT managing $52 billion compared to IVV’s $624 billion. This reversal is due to both the higher fee structure and surging demand for Bitcoin, which has outpaced interest in traditional equities. Experts point out that this trend is driven by “fee compression in core equity products” and a strong desire for regulated crypto investment options as institutions diversify their holdings.

Regulatory changes and broader economic trends have shaped the environment for these ETFs. The U.S. approval of spot Bitcoin ETFs in early 2024 sparked $54 billion in new investments in the sector, with

capturing more than 90% of the market. At the same time, Bitcoin’s price surge—hitting $100,000 by late 2025—was driven by supportive policies and speculative activity. However, recent trends have shown some instability, such as a $342 million net outflow in July 2025, indicating possible volatility as investor sentiment shifts.

BlackRock’s entry into the crypto space has established it as a major force in the digital asset sector. The rapid growth of its ETFs—IBIT now ranks as the 22nd-largest ETF worldwide by assets—shows the firm’s agility in adapting to new markets. While competitors like Fidelity and Grayscale have also attracted significant inflows, BlackRock remains the market leader. Analysts credit this to BlackRock’s strong reputation and the regulatory certainty its ETFs offer, making them attractive to cautious investors who want crypto exposure without directly holding digital assets.

The impact of BlackRock’s ETF success goes beyond revenue. These funds have transformed the crypto market by providing institutional-grade liquidity and lowering entry barriers. By mid-2025, U.S. spot Bitcoin ETFs collectively held 125,000 BTC in reserves, reflecting increased institutional involvement. While predictions for Bitcoin’s future price remain uncertain—Standard Chartered forecasts a possible $135,000 by September 2025—the demand driven by ETFs points to ongoing interest in the asset class.

Source: [1] BlackRock’s Crypto ETFs Revenue Surpass $260 Million Annually [2] BlackRock Bitcoin ETF drives more revenue than its … [3] BlackRock’s spot Bitcoin ETF IBIT Surpasses S&P 500 ETF Annual … [4] BlackRock’s Bitcoin (BTC) ETF Now Generates More Revenue [5] BlackRock's Bitcoin ETF (IBIT) Overtakes Its S&P …