BlackRock's digital assets segment pulled in $42 million in ETF fees during the first quarter of 2026, accounting for 1.75% of total ETF revenue while representing only 1.11% of ETF assets under management. A market plunge slashed the segment's AUM by $18.7 billion, yet crypto product fee rates remained significantly higher than BlackRock's broader ETF business.
The Fee Premium
Digital assets charged 24.8 basis points annually, far above the ETF complex's 17.2 basis points. The gap comes from higher-fee crypto products like BlackRock's Bitcoin ETF IBIT. That fund carries a 0.25% sponsor fee and held roughly $61.7 billion in net assets by late April.
Market Volatility vs. Investor Demand
Digital assets AUM fell from $78.4 billion at year-end 2025 to $60.6 billion by March 31 after a $18.7 billion market correction. But investors still sent $935 million into BlackRock's crypto ETFs during the quarter. That inflow represented less than 1% of the firm's total ETF deposits. The drop in value came from market moves, not customer withdrawals.
Product Breakdown
IBIT became the most-traded U.S. spot Bitcoin ETP despite the volatility. BlackRock's Ethereum products showed a stark contrast: ETHA held over $7 billion in assets while ETHB managed $594.5 million. ETHB stands out as a higher-value wrapper because it offers staking rewards, justifying its different fee structure.
Competitive Pressure
Morgan Stanley now charges just 0.14% for its Bitcoin ETF MSBT. Charles Schwab is testing a 75-basis-point per-trade model for crypto access. Both firms are actively expanding their crypto product lines with cheaper structures. BlackRock's next quarterly report will show whether the fee premium holds as rivals push harder into the space.
