Catenaa, Wednesday, May 14, 2025-BlackRock has updated its risk disclosures for the iShares Bitcoin Trust (IBIT), warning that future advances in quantum computing could undermine the cryptographic foundations of Bitcoin, potentially threatening investor assets.
BlackRock on May 9 submitted a revised S-1 filing to the U.S. Securities and Exchange Commission, warning that future advances in quantum technology could potentially break Bitcoin’s encryption systems.
Such a breakthrough could allow unauthorized access to wallets, compromising the integrity of funds held within the ETF.
Although the threat is currently theoretical, the firm included the disclosure as part of a standard practice to outline all material risks tied to its digital asset offerings.
Bloomberg ETF analyst James Seyffart said the update reflects routine transparency, not an imminent concern, explaining that issuers are expected to highlight all possible vulnerabilities, however remote.
The filing also reaffirms other ongoing risks, including regulatory uncertainties, high energy usage, mining centralization in China, and market volatility stemming from past events like the FTX collapse.
Despite these warnings, IBIT remains the top-performing spot Bitcoin ETF, with 19 consecutive days of inflows totaling over $5.1 billion.
In a separate update, BlackRock also amended its Ethereum ETF filing to include an in-kind redemption mechanism-enabling direct exchange of ETF shares for Ethereum. This could reduce trading friction and lower conversion costs. The SEC has yet to greenlight such models for crypto ETFs, though analysts anticipate regulatory movement later this year.
