Security Risks of BlackRock's Largest Bitcoin ETF

The world's largest Bitcoin ETF from BlackRock, which manages assets worth approximately $63 billion, could become the next target of North Korean hackers. The founder of OneKey warns about this.

The IBIT fund holds approximately 815,000 BTC, primarily stored with custodian Coinbase. Concentrating such huge volumes of bitcoins with a few providers makes them extremely attractive targets for cybercriminals.

The main threat lies not only in compromising private keys. Hackers just need to compromise the transaction signing infrastructure to withdraw funds without direct access to the wallets.

The scale of the risk is assessed as follows: a theft of $6 billion from IBIT would result in a loss of about 9.5% of the fund's assets. This is equivalent to a loss of approximately $4 per share.

BlackRock does not separately insure the fund's bitcoins. Custodian Coinbase has insurance coverage of $320 million, which applies to all clients through a common pool.

If the stolen BTC cannot be recovered and the insurance compensation proves insufficient, the final losses will be borne by IBIT investors. The founder of OneKey emphasizes the growing danger of concentrating digital assets.