BlackRock: Bitcoin is ‘gold alternative,’ Ethereum a ‘technology bet’ – Why?

• BTC is sound money and a ‘risk-off’ asset, per BlackRock.
• But ETH is a speculative bet on blockchain technology adoption. 

BlackRock, the world’s largest asset manager, recently presented unique yet different pitch decks for Bitcoin [BTC] and Ethereum [ETH]. 

The dual pitch deck was presented during a digital assets conference held in Brazil. BlackRock’s Robbie Mitchnick presented BTC as a ‘risk-off’ asset, putting it at par with or better than gold.

On the other hand, ETH was pitched as a ‘risk-on’ asset, similar to U.S. stocks. 

BTC as money; ETH as a bet

The asset manager praised BTC as a global monetary alternative and an excellent hedge against declining trust in governments and fiat currencies’ relentless debasement (devaluation). 

On the contrary, ETH was showcased as a speculative bet on blockchain technology adoption, an investment that Mitchnick equated to US stocks. 

He noted,

“On one hand, you have BTC, a commodity like gold and an alternative to stocks and bonds. Ethereum, more of a long-term technology bet that this blockchain will provide more use cases and more value to the economy going forward.” 

Part of the crypto community echoed Mitchnick’s presentations, underscoring that BTC is ‘money’ with less inflationary pressure than fiat currencies, which lose value annually. 

But it also settled the raging debate that has been going on for a while: ETH isn’t money. In fact, since the introduction of Blobs earlier this year, ETH’s inflation has hiked, making it less of an “ultra-sound money.”

If the projections hold, BTC could rally more during future geopolitical tensions, while ETH could decline in such scenarios. 

BlackRock’s perspective is crucial since it is a trendsetter and widely accredited. Along with Grayscale, the asset managers are perceived to be responsible for the US shift and final approval of US spot BTC ETFs. 

Since the ETFs debuted, BlacRock’s ETFs have outperformed every alternative offering and crossed key milestones.

At the time of writing, its BTC ETF, iShares Bitcoin Trust [IBIT], had a cumulative netflow of $21.5 billion with nearly $23 billion in net assets. 

That said, since it began trading in July, BlacRock’s ETH ETF, ETHA, has netted $1.1 billion in total inflows. 

Ergo, the world’s largest asset manager, could influence how other investors view the sector. According to some market observers, the message seems clear — Bitcoin is money, while the rest of crypto is speculative. 

In the meantime, BTC was valued at $62K, down 5% on the weekly charts. On the other hand, ETH was valued at $2.4K, down 8.5% over the same period.