BlackRock Exec: Bitcoin Remains Key Diversifier as AI Growth Expands Beyond Tech

BlackRock's Head of Equity ETFs Jay Jacobs believes that Bitcoin still serves as a portfolio diversifier, despite its increasing institutional ownership. Speaking on an Anthony Pompliano podcast, Jacobs argued that the fundamental nature of Bitcoin remains intact, even as the investor base has shifted over the years.

Jacobs also noted that AI opportunities are increasingly moving beyond traditional tech sectors. He pointed out that the physical buildout of materials, utilities, and digital infrastructure could benefit from AI's growth. This includes power companies, data centers, chip manufacturers, data owners, and model developers, among others.

According to Jacobs, the demand for AI is being driven by large language models (LLMs) that are writing code to improve themselves. However, the supply of physical inputs required for this growth takes years to materialize. For example, new copper supply takes years, building a zinc mine for photonics takes years, and fabs take about four years.

Jacobs emphasized that the best opportunities in AI now lie outside the tech sector. He highlighted materials, utilities, and real estate as key areas where investors are likely to find growth. BlackRock has even created separate products to cater to this physical layer of the AI value chain, including power and digital infrastructure ETFs.