BlackRock’s Bitcoin exchange-traded fund (ETF) has delivered a slightly higher return than the S&P 500 since its launch, although investors in the fund had to endure a decline almost three times greater than the benchmark’s worst fall.
The iShares Bitcoin Trust, known as IBIT, gained 67.74% between its debut on 11 January 2024 and 31 August. Over the same period, Vanguard’s S&P 500 ETF, VOO, returned 66.14% on a total-return basis, with dividends reinvested.
The difference between the two funds was therefore just 1.60 percentage points, despite Bitcoin reaching a record high before surrendering a substantial part of its gains during a lengthy downturn.
“Hard to believe IBIT is beating VOO since inception but it’s true,” Bloomberg senior ETF analyst Eric Balchunas wrote on 1 September, while stressing that the margin remained narrow.
Balchunas likened IBIT’s rise of about 70% to the El Toro roller coaster at Six Flags Great Adventure. By comparison, he described VOO’s performance as more like “a walk in the park”. He said IBIT’s result was particularly striking because Bitcoin sentiment remained bearish for much of the period from October through July.
The headline returns, however, conceal a major difference in the experience of investors.
IBIT suffered a maximum peak-to-trough decline of 53.30% between 6 October 2025 and 30 June 2026. VOO’s largest drawdown during the same comparison period was 18.69%, recorded between 19 February and 8 April 2025.
That means investors who bought both funds when IBIT launched finished 31 August with broadly comparable overall gains. Bitcoin ETF holders, though, had to tolerate a fall of more than half from the fund’s highest point.
Bitcoin’s price movements account for much of the contrast. BTC was trading close to $47,000 when US spot Bitcoin ETFs began trading in January 2024. Its value later climbed to a record of about $126,000 in 2025, following Donald Trump’s election victory.
Bitcoin subsequently dropped to approximately $58,000 this year before recovering to around $77,000 at the time of publication. That reversal removed much of IBIT’s earlier advantage, which had been built during Bitcoin’s surge to record levels.
Despite the asset’s volatility, Wall Street has continued to develop a deeper financial infrastructure around Bitcoin. BlackRock has recommended a 2% BTC allocation for investors looking for diversification and the possibility of long-term returns.
The comparison also involves funds at very different stages of development.
IBIT is now the largest spot Bitcoin ETF, with about $60bn in assets under management. It has attracted roughly $63bn in inflows since launch, giving BlackRock’s less-than-three-year-old product a scale that few newly established ETFs have achieved.
VOO, however, operates on a much larger scale. The Vanguard fund tracks the S&P 500 and gives investors broad exposure to large-cap US equities. In June 2026, it passed $1tn in net assets, becoming the first ETF to reach that milestone.
Oluwapelumi values Bitcoin’s potential and writes about subjects including decentralised finance, hacks, mining and culture, highlighting what he sees as the asset’s transformative power.
CryptoSlate may use AI tools to assist with research, editing and production workflows. Its journalism remains human-led, with the editorial team responsible for every published article. The publication directs readers to its full AI usage disclaimer.
The views expressed by CryptoSlate’s writers are their own and do not represent the publication’s opinion. None of the information in the article should be treated as investment advice, and CryptoSlate does not endorse any project mentioned or linked in the piece.
Buying and trading cryptocurrencies is considered a high-risk activity. Readers are advised to carry out their own due diligence before taking action in response to the article. CryptoSlate accepts no responsibility for losses resulting from cryptocurrency trading and provides further information in its company disclaimers.
CryptoSlate also invites readers to “Follow the signal” so they do not miss market-moving updates.
