Al Warda Investments Increases Bitcoin Holdings in BlackRock ETF

TLDR

• Al Warda Investments increased its Bitcoin holdings by 230% in the third quarter, bringing the total to $517.6 million.
• The firm’s move into BlackRock’s iShares Bitcoin Trust marks a shift away from its usual focus on private-market investments.
• Al Warda views Bitcoin as a long-term store of value, similar to gold, for portfolio diversification.
• Bitcoin’s price volatility remains a challenge, with a 30% drop from October’s peak affecting investor sentiment.
• Al Warda joins a growing number of institutional investors expanding their positions in Bitcoin ETFs.

Al Warda Investments, the investment arm under the Abu Dhabi Investment Council (ADIC), increased its Bitcoin exposure in Q3. The firm raised its holdings in BlackRock’s iShares Bitcoin Trust (IBIT) by 230%, reaching just under 8 million shares. This surge in holdings, valued at $517.6 million, coincided with Bitcoin’s rise to near $126,000 in October before retreating below $90,000 in November.

Al Warda’s Bitcoin Move Reflects Shift in Institutional Strategy

Al Warda’s decision marks a shift in its typical investment strategy. The firm usually favors private-market investments such as buyouts, real estate, and infrastructure. This move into a U.S. Bitcoin ETF signals a change in institutional investment within the region.

The firm’s Bitcoin acquisition comes as the digital asset is increasingly seen as a long-term store of value. An ADIC spokesperson explained, “We view bitcoin as a store of value similar to gold.” This view suggests that Bitcoin is now considered alongside gold in long-term portfolio strategies.

Bitcoin’s volatility remains a concern for some, with the price retreating 30% from October’s peak. Despite this, ADIC has expressed confidence in the asset’s role in portfolio diversification. As the world becomes more digital, the spokesperson added, Bitcoin’s place in global markets is expected to grow.

Al Warda is not alone in its move into Bitcoin. The firm joins a growing number of institutional investors scaling up their exposure to spot Bitcoin ETFs. The increase in institutional allocations comes amid growing acceptance of Bitcoin as a viable asset for diversification.

The firm’s position in IBIT is part of a wider trend seen in other institutional investors. Harvard University’s endowment fund, for example, allocated $443 million to IBIT in its latest filing. Harvard’s Bitcoin investment accounts for around 20% of its U.S. equity exposure, showing strong support for the asset.

Al Warda’s action also mirrors moves by other sovereign wealth funds and large investors. This trend highlights Bitcoin’s evolving role in institutional portfolios. Despite its volatility, the growing interest in Bitcoin as a store of value signals increased institutional acceptance of the asset.

Bitcoin ETFs Face Market Challenges Despite Institutional Interest

Bitcoin ETFs, including IBIT, have faced challenges amid market turbulence. The price fluctuations have led some investors to exercise greater caution. On November 18, IBIT saw its largest single-day outflow since its launch in January 2024.

Despite this, cautious interest has started to return. IBIT recorded its first net inflow in over a week on November 20, suggesting some recovery in investor sentiment. This reflects a more measured approach as investors continue to navigate Bitcoin’s price volatility.

Al Warda’s increased investment in Bitcoin through IBIT highlights a shift in how institutional investors approach digital assets. While the market remains volatile, growing confidence in Bitcoin’s long-term value continues to shape institutional strategies.

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