BlackRock’s IBIT Surpasses Exchanges as Largest Bitcoin Custodian

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🔑 Key Takeaways

  • BlackRock’s iShares Bitcoin Trust (IBIT) has become the largest custodian of BTC, surpassing Coinbase and Binance.
  • Marks a decisive shift toward institutional takeover of Bitcoin custody.
  • Signals Bitcoin’s deepening financialization on Wall Street.
BlackRock headquarters with Bitcoin logo symbolizing institutional custody dominance

🗞 Main Story

BlackRock’s iShares Bitcoin Trust (IBIT) has overtaken centralized exchanges as the largest Bitcoin custodian, holding more BTC than Coinbase and Binance combined. This milestone marks a paradigm shift: Wall Street’s biggest asset manager now safeguards more Bitcoin than crypto-native platforms, signaling Bitcoin’s entry into a new financial era.

Historically, Bitcoin custody was dominated by exchanges serving retail traders. But IBIT’s rapid growth—fueled by institutional inflows and ETF demand—has reshaped the landscape. Much like gold in the 1970s, Bitcoin is being financialized: stored in ETF wrappers, regulated under the SEC, and incorporated into pension and sovereign fund portfolios.

The move also underscores growing regulatory acceptance. With SEC oversight, audited reports, and insured custodianship, IBIT provides safeguards retail platforms often lack. For institutions wary of counterparty risk, this makes Bitcoin allocations more attractive. Still, critics warn of a concentration problem: as Wall Street giants absorb more BTC, questions about decentralization and control resurface.

Bitcoin financialization as BlackRock’s ETF dominates custody market

🔬 Expert Opinion

  • Larry Fink (CEO, BlackRock): “Tokenization is the future of markets, and Bitcoin ETFs are the gateway. Custody at scale brings legitimacy.”
  • James Butterfill (Head of Research, CoinShares): “IBIT’s rise reflects the centralization trade-off—greater trust and regulation, but weaker decentralization.”

🌟 Implications

Bitcoin is entering its Wall Street era. Institutional custody ensures legitimacy and accelerates adoption, but decentralization purists fear this shift undermines Bitcoin’s ethos. The balance between mass adoption and ideological purity is now at stake.

🛬 Sources

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