The world's largest asset manager has officially opened Bitcoin investment access to British retail investors through a regulated exchange-traded product, marking a watershed moment for cryptocurrency adoption in the United Kingdom.
BlackRock listed its iShares Bitcoin ETP (ticker: IB1T) on the London Stock Exchange on Monday, October 20, following the Financial Conduct Authority's decision to reverse its prohibition on crypto-linked investment products for everyday investors.
The launch represents a significant policy reversal that positions the UK closer to other major financial markets in Europe and North America.
Historic Regulatory Shift Opens UK Market
The FCA officially lifted its four-year retail ban on crypto exchange-traded notes effective October 8, ending restrictions first imposed in January 2021 during the height of regulatory concerns about cryptocurrency volatility and investor protection.
David Geale, the FCA's executive director of payments and digital finance, acknowledged the market's evolution in the regulator's announcement. "Since we restricted retail access to cETNs, the market has evolved, and products have become more mainstream and better understood," Geale stated. "In light of this, we're providing consumers with more choice, while ensuring there are protections in place."
The regulatory reversal follows the FCA's March 2024 decision to permit professional investors to access crypto exchange-traded notes on recognized investment exchanges. The regulator has maintained its ban on crypto derivatives for retail investors, citing their high-risk nature and complexity.
BlackRock's Entry Signals Institutional Confidence
BlackRock's iShares Bitcoin ETP allows UK investors to gain Bitcoin exposure starting at approximately $11 per unit through traditional brokerage accounts, eliminating the operational complexities of directly holding cryptocurrency. The product tracks Bitcoin's spot price and is 100% physically backed by Bitcoin held in custody through Coinbase, with assets transferred to segregated, offline cold storage at the end of each trading day.
Jane Sloan, BlackRock's EMEA Head of Global Product Solutions, emphasized the timing of the launch. "As the UK crypto investor base is projected to approach four million over the next year, today's listing of ETPs like iShares Bitcoin ETP unlock a securer gateway to digital assets through traditional investment platforms," Sloan said in a statement to the Financial Times.
The ETP carries a total expense ratio of 15 basis points annually through December 31, 2025, rising to 25 basis points from January 2026 onward.
BlackRock's move leverages its extraordinary success in the United States, where its iShares Bitcoin Trust (IBIT) has accumulated $85.5 billion in net assets, making it the largest spot Bitcoin ETF globally. The U.S. product, launched in January 2024, reached $90.7 billion in assets by early October and entered the top 20 ETFs by assets for the first time.
Competitive Landscape Intensifies
BlackRock faces immediate competition from established European crypto asset managers who simultaneously launched their own products for UK retail investors. 21Shares, Bitwise, and WisdomTree all listed Bitcoin and Ethereum ETPs on the London Stock Exchange this week, introducing aggressive pricing to capture market share.
21Shares listed four physically backed crypto ETPs, including products for Bitcoin and Ethereum with staking capabilities, at a reduced 0.1% fee structure. The Swiss-based firm, which captured over 70% of institutional crypto ETN trading volume on the LSE in 2024, called the retail opening "a landmark step for the UK market."
Bitwise slashed fees for its Core Bitcoin ETP to just 0.05%, among the lowest in the market, while WisdomTree's offerings range from 0.15% to 0.35% for Bitcoin and Ethereum products.
Growing UK Crypto Adoption
The timing of these launches coincides with accelerating cryptocurrency adoption in the United Kingdom. Research cited by BlackRock indicates UK crypto adoption has grown at a 12% annualized rate since 2022, with projections suggesting a 21% increase in first-time crypto investors over the next 12 months.
An FCA survey from 2024 found that 12% of Britons currently hold crypto assets, with average holdings of approximately £1,842. Industry research from IG Group suggests that 30% of UK adults remain open to investing in crypto ETNs, driven by perceived safety and regulatory oversight.
The new products qualify for tax-advantaged accounts, with crypto ETNs eligible for Stocks & Shares ISAs starting in April 2026 and available in Self-Invested Personal Pensions (SIPPs) immediately.
Market Context and Outlook
Bitcoin has demonstrated remarkable strength in 2025, with the cryptocurrency trading above $110,000 as the UK products launched. The asset's performance has been fueled by institutional demand, tightening supply following the 2024 halving event, and surging interest in regulated investment vehicles globally.
The UK's approach aligns it more closely with other major markets. The United States approved spot Bitcoin ETFs in January 2024, while European markets in Germany, France, Switzerland, and the Netherlands have offered similar products for several years. Canada and Hong Kong have also established regulated crypto investment pathways for retail investors.
However, the UK remains behind some European peers in overall market development. According to London Stock Exchange data, crypto ETN trading volumes on the LSE represent just 0.59% of total European activity, averaging £624,000 daily compared to €26 billion in European crypto ETN trading throughout 2024.
The FCA emphasized that its regulatory framework continues to evolve. The regulator is consulting on comprehensive regulations covering stablecoins, trading platforms, lending, staking, and custody services, with full implementation expected in 2026. The government has also moved to allow asset managers to use blockchain technology for fund tokenization, recognizing its potential to drive fundamental changes in asset management.
Final Thoughts
The BlackRock Investment Institute recommends that investors able to tolerate Bitcoin's volatility consider allocations of 1-2% in diversified portfolios. The institute emphasizes that cryptocurrency investments carry substantial risks, including extreme price fluctuations and the absence of Financial Services Compensation Scheme protection.
Unlike crypto derivatives, which remain banned for UK retail investors, exchange-traded notes are structured as debt securities that track cryptocurrency prices with underlying assets held by regulated custodians. This structure provides regulatory oversight while eliminating the need for investors to manage digital wallets or private keys.
As BlackRock and its competitors vie for position in the newly opened UK market, the launches signal growing mainstream acceptance of cryptocurrency as an investable asset class, backed by the world's largest financial institutions and operating within established regulatory frameworks.