BlackRock generated $82 million in revenue from its digital-asset products during the first half of 2026, even as falling Bitcoin and Ethereum prices erased nearly $30 billion from the assets supporting the business.
The world’s largest asset manager recorded $42 million in digital-asset base fees and securities-lending revenue in the first quarter, followed by $40 million in the three months ended June 30.
The results extend a lucrative expansion into cryptocurrency products that began with the launch of BlackRock’s spot Bitcoin and ETH exchange-traded funds in 2024. These funds generated about $174 million in net sponsor fees last year as digital-asset prices and investor demand surged.
Revenue proved more resilient during this year’s downturn because BlackRock collected fees on average balances that remained substantially higher than the amount held at the end of the second quarter.
BlackRock’s Q2 filing showed average digital-asset assets under management of $67.74 billion in the first quarter and $61.48 billion in the second. The balance had fallen to $48.84 billion by June 30.
That difference softened the immediate revenue impact. Second-quarter digital-asset fees declined by just $2 million, or about 5%, from the previous three months, even as ending assets dropped almost 20%.
Crypto price declines, not withdrawals, drove the decline
The resilience of BlackRock’s fee income masked a sharp contraction in the assets generating it. Data from CryptoSlate showed that BTC and ETH declined by more than 26% respectively since the beginning of this year.
As a result, BlackRock’s digital-asset AUM fell 38% during the first half of the year, declining to $48.84 billion from $78.44 billion at the end of December.
Most of the damage came from the market rout rather than investor redemptions. BlackRock attributed $27.4 billion of the decline to lower asset prices, compared with $2.18 billion of net withdrawals and an $11 million foreign-exchange effect. This means that market depreciation accounted for roughly 93% of the total reduction.
The pattern was evident from the start of the year. BlackRock’s crypto products attracted about $934 million in the first quarter, yet assets fell to $60.67 billion by March 31 as the value of the Bitcoin and ETH held by the funds declined.
Conditions weakened further in the second quarter. Investors pulled $3.12 billion from the products, more than reversing the inflows recorded during the first three months, while market movements erased another $8.71 billion. Digital-asset AUM consequently dropped 19.5% between March and June.
The two pressures worked differently. Redemptions reduced the amount of capital invested in the products, while lower cryptocurrency prices diminished the value of the remaining assets. Because BlackRock’s spot funds track their underlying tokens, their assets can contract sharply even without equivalent investor redemptions.
BlackRock’s flagship Bitcoin and Ethereum funds reflected that sensitivity. Their balances declined substantially from their start-of-year levels, then recovered somewhat after the second quarter as Bitcoin rebounded toward $65,000 in July.
By mid-July, the iShares Bitcoin Trust and iShares Ethereum Trust held a combined total of about $52.6 billion, recouping only part of the losses sustained earlier in the year.
BlackRock looks beyond spot ETFs for its next revenue leg
The contraction in BlackRock’s cryptocurrency funds has not altered its longer-term expansion plans. It has instead increased the importance of businesses that could generate digital-asset revenue without depending as heavily on rising Bitcoin and Ethereum prices.
Chief Financial Officer Martin Small said on the earnings call that BlackRock has about $110 billion in assets tied to digital markets and aims for the segment to generate $500 million in annual revenue by 2030.
This revenue target would be roughly three times the annualized pace implied by the $82 million generated during the first half of this year. Reaching it will require BlackRock to expand beyond fees collected from spot cryptocurrency ETFs.
Small outlined three areas of focus: connecting regulated investment products to digital markets, managing reserves backing stablecoins, and placing traditional investment products on blockchain networks.
BlackRock has already broadened its investment lineup beyond IBIT and ETHA. The company launched the iShares Staked Ethereum Trust ETF in February, giving investors exposure to ETH and a portion of the rewards generated by staking the token.
It followed in June with the iShares Bitcoin Premium Income ETF, which combines Bitcoin exposure with an options strategy intended to generate monthly income.
Those products widen the fees BlackRock can earn from cryptocurrency investors, but their assets remain sensitive to market prices and investor sentiment.
The larger potential shift lies in reserve management and tokenization, where BlackRock could earn revenue from digital-market infrastructure without relying entirely on a recovery in Bitcoin or Ethereum price.
BlackRock manages about $60 billion of reserves for Circle, the issuer of the USDC stablecoin, Small said. The amount represents almost one-fifth of the roughly $310 billion stablecoin market,
The company is seeking similar mandates from other issuers as the sector expands. Such arrangements could generate management fees from the cash, Treasury securities and other assets backing stablecoins, allowing BlackRock to benefit from growth in digital payments even when demand for speculative cryptocurrency products weakens.
Reserve management also fits BlackRock’s existing money-market and cash-management operations. Stablecoin issuers require liquid assets that can support customer redemptions while generating income from the reserves held against their tokens.
BlackRock’s tokenization strategy extends that opportunity by using stablecoins and blockchain networks to distribute its conventional investment products.
Small said the company recently filed registration statements for two tokenized money-market offerings. One would create an Ethereum-based share class for an existing fund, while the other would include digital-market features such as daily dividend reinvestment.
BlackRock expects the products to become available across multiple blockchain networks and to support subscriptions and redemptions funded with stablecoins. The structure could allow investors to move from digital cash into money-market funds without first transferring assets through a conventional brokerage account or banking platform.
The filings build on BUIDL, BlackRock’s tokenized Treasury and cash-management fund. The company eventually wants to apply similar structures to a wider range of products, including iShares ETFs, long-term stock and bond portfolios and private-market investments.
Small said:
“Over the longer term, we want BlackRock’s products to be accessible natively where many investors already hold digital assets.”
The strategy would turn blockchain-based wallets into another distribution channel for BlackRock’s existing products. Investors could allocate across stablecoins, cryptocurrencies, stocks, bonds, and cash-management funds within the same digital account.
Small cited an estimated 5 billion digital wallets globally as evidence of the potential scale of that network.
BlackRock views these blockchain-based accounts as a way to reach investors who may not currently use conventional financial platforms. Rather than building its digital-assets business solely around demand for Bitcoin and Ethereum, the company wants to place a broader range of investment products inside the systems where stablecoins and other blockchain assets are already held.
Small stated:
“We want to build a digital wallet-native asset manager.”
That ambition makes the $500 million target dependent on more than a recovery in BlackRock’s spot ETFs. Stablecoin reserve mandates, tokenized funds and blockchain-based distribution will need to become meaningful businesses alongside IBIT, ETHA and BUIDL.
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