A Cautious Short Term, A Bullish Long Term
The world's largest asset manager remains convinced that Bitcoin is ultimately heading "considerably higher," even after the asset has sold off 50% from recent levels. The firm's chief investment officer addressed a pointed, specific question directly: with Bitcoin down sharply, is it a buy now, or should investors wait for more? His answer was that it is ultimately going much higher over the long term, but that there are technical conditions surrounding the asset that cause it to "chop around" in the near term.
For that reason, exposure is being kept deliberately moderate rather than aggressive. The reasoning is twofold. First, there are other compelling opportunities elsewhere — in technology and certain "growth engines" already discussed — that compete for capital. Second, and importantly, there are currently attractive places to earn yield that are not Bitcoin: parts of the credit markets and emerging markets (EM). Because those yield opportunities looked merely "okay" but viable, exposure to Bitcoin has been reduced. The bottom-line view, repeated firmly, is that Bitcoin is going higher ultimately.
Japan's Rate Hike and the Drain on Speculative Assets
A key short-term headwind is monetary policy in Japan. Japan's central bank raised its main interest rate to a new 31-year high, the highest level in over three decades, in response to a surge in global energy prices. The goal of the hike is to suppress inflation. The practical effect, however, is that it takes money out of the financial system — and removing liquidity is bad in the short term for more speculative assets like Bitcoin. This was reflected in a market dip on the day in question.
Combined with the availability of yield elsewhere — driven by both emerging-market and global credit conditions — this dynamic is "taking some wind out of the sails" for Bitcoin in the immediate term. The competition for capital is real: when investors can get solid yield from credit and EM, they have less incentive to hold a non-yielding speculative asset.
Why BlackRock's Scale Matters
The conviction here carries weight because of the sheer size of the institution behind it. The firm manages over $12 trillion in assets under management (a figure referenced elsewhere as approaching $14 trillion), making it the largest asset manager in the world. Critically, it does not merely hold assets — it advises people on where to put their money. When an institution of that scale and influence positions itself for higher Bitcoin prices over the long term, the recommendation cascades across an enormous client base.
Building the Plumbing: The New Bitcoin Income ETF
A central theme is that the infrastructure — the "plumbing" — for vast new inflows into Bitcoin is actively being built. The latest piece of that infrastructure is a newly launched Bitcoin Premium Income ETF, now trading live under the ticker BIDA.
The mechanics of this product are important. It uses covered calls, a strategy that caps the potential upside an investor receives from Bitcoin but in exchange delivers monthly income. In effect, the issuer takes on the risk while the investor buys the income stream. This represents a different kind of on-ramp from a simple spot Bitcoin holding.
The deeper significance is psychological and structural. New capital does not need to understand — or even consciously choose — that it is buying Bitcoin. An investor simply puts money into "an investment product from BlackRock," an income-product ETF that happens to have something to do with Bitcoin. This abstraction is precisely where new capital on-ramps occur: money flows into the asset indirectly, through familiar, branded, income-generating wrappers rather than through direct crypto purchases. Each new product like this is another signal that the rails are being laid for more money to enter the system.
Bitcoin's Relative Strength Amid a Stock Sell-Off
Even as broader markets fell — with over $300 billion wiped out from the US stock market in a single day — Bitcoin held up relatively well. That resilience during a broad risk-off move was viewed as an encouraging sign of underlying strength.
SpaceX: The Capital Magnet
As money flowed out of broader markets ("the masses"), a notable amount flowed into SpaceX, which officially surpassed Microsoft to become the fourth-largest public company in the world, now worth almost $3 trillion.
Is It Overvalued?
A natural question arises: is a $3 trillion valuation on roughly $18 billion of revenue overvalued? Based purely on revenue multiples, the answer is clearly yes. But there is a structural explanation for why the price can rise so quickly in the short term: only about 5% of SpaceX stock is currently floating. The remaining 95% is still locked. With such a thin float, even modest buying pressure can drive the price up sharply.
The Coming Unlocks and the Dilution Risk
The crucial caveat is that bearish pressure often arrives later, when insiders finally gain liquidity. With the IPO occurring around the 12th, there is a 20% unlock coming, followed by a series of 7% unlocks, and a remaining 28% unlocking 180 days later. As locked shares become tradable, supply expands and can weigh on the price.
This pattern — while new and unfamiliar to many traditional stock investors — is intimately familiar to crypto investors. They have spent years complaining about "low-float, high-FDV" (fully diluted value) tokens: coins that launch with a small circulating supply, perform spectacularly out of the gate as the price climbs, and then collapse months or multi-months later as dilution kicks in. The irony is striking: the era of crypto investors complaining about low-float, high-FDV coins effectively ended with traditional investors now bidding SpaceX up to a $3 trillion valuation under the very same structural dynamics. It is not necessarily a good thing, but it is a familiar one. For now, though, real money continues to flow in.
Active ETFs Are Choosing to Buy
The buying is not passive. According to a senior Bloomberg ETF analyst, the number of ETFs holding SpaceX exploded from 4 to 40 to 120 in just a couple of days, with a few billion dollars of total inflows. The key distinction is that these are active ETFs choosing to buy — not index funds. Index funds come later and are forced to buy by their mandates; these active managers are making a deliberate decision. Sorted by new buys, the second-largest active ETF in the world (a JPQ fund) sits at the top, and many JP Morgan funds were among the buyers. SpaceX is "stealing all the liquidity" precisely because there is genuine institutional buying pressure happening right now.
SpaceX Meets Crypto Rails
SpaceX's historic public debut is framed as one of the biggest catalysts for crypto adoption, with much of the activity routing through crypto infrastructure.
- Tokenized equities on Solana: Tokenized equities hit a new all-time high in 24-hour spot volume on Solana — $187.9 million. A major driver was tokenized stocks, including a tokenized SpaceX offered by Backpack and Sunrise DeFi, which alone surpassed $15 million — more than 50% of the total volume. This shows large numbers of investors choosing to gain exposure to tokenized equities through Solana, the decentralized (DeFi) option.
- Binance perpetuals: Inflows and users are also flocking to exchange partner Binance to access traditional-finance exposure. Over $5.6 billion was traded in SpaceX in 24 hours, making it the number-two most traded product on Binance (which has millions of users), behind only Bitcoin perpetuals. Notably, this is all through perpetuals: users trade Bitcoin first, then SpaceX. Binance commands over 60% market share across both centralized exchanges (CEXes) and decentralized exchanges (DEXes). Users are choosing to get SpaceX exposure through crypto rails — an onboarding dynamic seen as bullish for the ecosystem.
Crypto Innovation Continues Through the Bear Market
Beyond SpaceX, genuine innovation and consolidation are proceeding even amid weak prices:
- Ripple acquired a stake in Flutterwave, valuing the African fintech firm at $3.3 billion. This is a move to gain greater exposure to the African fintech market.
- Robinhood bought Wonderfy, expanding its Canadian crypto exposure and clientele.
- Noble Mobile bought Helium Mobile, an example of traditional finance (TradFi) integration — buying into the Solana DePIN (decentralized physical infrastructure / "Deepen") ecosystem, which is positive for Solana.
The takeaway from these deals is to watch which companies and crypto coins keep building and implementing even through the bear market.
Decentralized AI as the Next Frontier
A particularly interesting signal came from the legacy player Grayscale, which speaks to institutional clientele. Grayscale argued that centralized AI companies are more vulnerable to government intervention than decentralized ones. As a concrete example, it pointed to a leading centralized AI company whose products were suspended by the US government over security concerns.
By contrast, decentralized AI projects such as Bittensor (TAO) offer an alternative path. Bittensor provides open-source, permissionless access to AI through a decentralized global network. When the centralized AI model was suspended, permissionless protocols stood out as a solution that cannot be shut down by a single authority. Following the suspension, TAO rallied sharply — climbing 30% in just 12 hours. The fact that an institution-facing player like Grayscale is publicly highlighting this rally is itself a meaningful signal: decentralized AI is not going away, and the thesis is gaining institutional attention.
The Overarching Thesis
Pulling the threads together: in the short term, tighter global liquidity (driven by Japan's record rate hike) and the availability of yield in credit and emerging markets are restraining Bitcoin and other speculative assets. But underneath that near-term chop, the structural machinery for the next wave of capital is being assembled — new income-oriented ETF wrappers that let trillions flow in without investors even consciously choosing crypto, tokenized equities trading on decentralized rails, surging activity on major exchanges, ongoing strategic acquisitions, and the rise of decentralized AI as a censorship-resistant alternative. The long-term conviction, anchored by the world's largest asset manager, remains that Bitcoin is going considerably higher.
