Bitcoin price rose above $90,000 on Wednesday, extending a strong rally driven by accelerating institutional demand and a new wave of Wall Street-designed crypto products.
The rise followed new revelations showing BlackRock increasing its exposure to its own Bitcoin spot ETF, and JPMorgan launching a complex, high-risk structured note linked directly to BlackRock’s IBIT fund.
Bitcoin price hit 24-hour lows of $86,129 before bouncing above $90,300, continuing a volatile rally that has defined the fourth quarter.
BlackRock’s latest regulatory filing shows that the Strategic Income Opportunities Portfolio now owns 2,397,423 shares of IBIT, valued at $155.8 million as of September 30. That’s up 14% from June, when the fund reported 2,096,447 shares.
The steady accumulation underscores how the world’s largest asset manager is using its internal portfolios to deepen its Bitcoin-linked positions.
The moves come as demand for structured cryptocurrency-linked investments increases among major banks. JPMorgan’s proposed new derivative-style note offers institutional clients a way to bet on the future price of Bitcoin through IBIT, currently the largest Bitcoin ETF with nearly $70 billion in assets.
The product is unusual and aggressive. The note sets a price for IBIT next month. If, within a year, IBIT trades at or above that price, the note is automatically canceled and investors earn a fixed 16% return.
If IBIT trades below the set level in one year, investors stay in the product until 2028. If IBIT exceeds JPMorgan’s next price target by then, investors earn 1.5 times their investment with no upside limit. If the price of Bitcoin skyrockets, payments follow.
There is also protection against downsides. If IBIT ends 2028 with a drop of no more than 30%, investors will receive a full return of capital. But if the ETF falls more than 30%, the losses will equal the drop in IBIT.
The structure combines a bond-like wrapper with derivatives exposure, a formula that FINRA broadly classifies in its “structured notes” category. These notes combine a traditional security with option-based payments tied to a reference asset, in this case the BlackRock Bitcoin ETF.
The argument for institutions is simple: predictable returns if Bitcoin’s price stagnates next year, upside leverage through 2028, and limited long-term downside. The trade-off is equally clear: no interest payments, no FDIC insurance, and the risk of losing most or all of your principal.
Reporting from The block helped with this article.
Bitcoin Price Volatility
JPMorgan is explicit about what is at stake. Its prospectus warns that investors “should be willing to lose a significant portion or all of their principal amount at maturity.” Bitcoin’s volatility, he adds, can be extreme, and the notes remain unsecured obligations of the bank.
The bank’s latest move also highlights a continuing shift in Wall Street’s tone toward Bitcoin. CEO Jamie Dimon once mocked Bitcoin as “worse than tulip bulbs.” However, JPMorgan is now designing products that depend on the long-term trajectory of the digital asset.
Morgan Stanley has been exploring similar territory. Its own IBIT-linked structured note earned $104 million last month. The bank’s two-year “dual directional self-purchase” product offers improved payouts if IBIT rises or remains stable, and modest gains if it falls by up to 25%. But once losses exceed that level, investors take the hit without protection.
Analysts say these products reflect a revival of the structured note market. Bloomberg reported that the sector is recovering from a decade-long crisis after the collapse of Lehman Brothers wiped out billions tied to similar instruments.
The price of bitcoin has fallen more than 30% from its all-time high in October, falling to around $87,000, as a nearly two-month decline keeps markets on edge. Mid-tier whale wallets holding more than 100 BTC are rising, a potential sign of bargain hunting, but larger whale cohorts continue to offload, contributing to weakening spot demand.
Analysts warn that the key support zone between $80,000 and $83,000 is being tested repeatedly, while Citi says the market lacks the necessary entries to stabilize prices.
At the time of writing, the price of bitcoin is $90,049.
