[BlackRock Records $3.6 Billion in IBIT Physical Conversions, Security Considerations a Major Driver] BlockBeats reported on November 10th, citing Barron's, that Robbie Mitchnick, head of BlackRock's digital assets business, stated that since regulators approved physical redemptions of crypto assets last year, the company has recorded approximately $3.6 billion in physical conversions from directly held Bitcoin to shares of its spot Bitcoin ETF, IBIT. Since BlackRock does not process all transactions itself and may not see every conversion, the actual scale is likely larger. BlackRock also provides physical conversions for the iShares Ethereum Trust ETF and the iShares Staked Ethereum Trust ETF, but the scale is far smaller than that of IBIT. Mitchnick stated that demand continues to rise, currently representing the highest level of interest the company has seen, and this remains unchanged regardless of Bitcoin price fluctuations. Mitchnick stated that the single biggest motivation is security and peace of mind. Outsourcing custody to institutional-grade cold storage is more attractive to holders; holding shares of ETFs managed by large funds is generally considered less risky than keeping assets on crypto exchanges or always-on hot wallets. He mentioned that the recent Binance hack highlighted the risks of trading platforms again, although large Bitcoin holders are already aware of these risks. The minimum threshold for physical conversion has been reduced from approximately $30 million initially to approximately $1 million to $2 million, set by the intermediaries facilitating the transactions: Galaxy Digital, Talos, and Virtu. Mitchnick stated his hope is to lower the threshold to a single ETF share, but the cost structure is unlikely to be reduced to zero in the short term. [Original Link]