BlackRock's Bitcoin ETF Barely Beats S&P 500 Despite Crushing Drawdown

BlackRock's Bitcoin exchange-traded fund (ETF), the iShares Bitcoin Trust (IBIT), has outperformed the S&P 500 since its launch in January 2024, despite subjecting investors to a 53% crash. According to Eric Balchunas, Bloomberg's senior ETF analyst, IBIT returned 67.74% from its debut through August 31, compared to 66.14% for Vanguard's S&P 500 ETF (VOO).

The narrow lead of 1.6 percentage points came after Bitcoin surged to a record high and then fell back in a prolonged downturn. The comparison is surprising given the bearish mood that dominated Bitcoin from October 2025 through July.

IBIT's drawdown was nearly three times as deep as VOO's, with a peak-to-trough decline of 53.30% between October 6, 2025, and June 30, 2026. In contrast, VOO's maximum drawdown over the comparison period was 18.69%, from February 19 through April 8, 2025.

Bitcoin's price history helps explain much of that gap, with its value trading near $47,000 when US spot ETFs debuted in January 2024 and later surging to a record high of around $126,000 in 2025. However, its value then fell as low as roughly $58,000 this year before recovering to around $77,000.

The volatility has not stopped Wall Street from building deeper infrastructure around the asset, with BlackRock recommending a 2% BTC allocation for investors seeking diversification and long-term return potential. Meanwhile, IBIT is now the largest spot Bitcoin ETF, managing about $60 billion in assets and having accumulated roughly $63 billion of inflows since launch.