BlackRock's Bitcoin ETF Beats the S&P 500: What Does That Mean?
IBIT returned 71% since its 2024 debut, against 66% for Vanguard's S&P 500 ETF — but with a 53% maximum drawdown along the way. Understand the full comparison.
The world of finance is in constant transformation, and Bitcoin has been one of the main protagonists of that change. On 2 September 2026 the comparison came out: BlackRock's Bitcoin ETF, IBIT, had accumulated a 71% gain since its debut in January 2024, against 66% for Vanguard's S&P 500 ETF, VOO, in total return. Two precisions the headline does not carry, and which change the reading: the period is roughly two and a half years, not recent, and the difference is five percentage points — a narrow edge, not a decoupling. But what does that really mean for investors and for the future of cryptocurrency?
What is a Bitcoin ETF and why does it matter?
To understand the magnitude of this news, we first need to demystify some terms. An ETF (Exchange Traded Fund) is a type of investment fund that holds assets such as shares, commodities or cryptocurrency, and whose units are traded on stock exchanges like shares. In other words, an ETF lets you invest in a set of assets without needing to buy them individually.
A Bitcoin ETF is therefore a fund that allows investors to gain exposure to the price of Bitcoin without needing to buy and store the cryptocurrency directly. BlackRock launched one of these funds, and the 71% return since its debut — against 66% for Vanguard's S&P 500 fund — is usually presented as proof of Bitcoin's appreciation potential. The comparison deserves completing, because return without risk is half the information: to reach that result, the IBIT investor lived through a maximum drawdown of 53.30% from the previous peak, while VOO had a maximum drawdown of 18.69% over the same interval. Two products arrived at a similar return by very different paths, and the path is what determines who manages to stay invested to the end. The S&P 500, in turn, is a stock market index representing the performance of the 500 largest publicly traded companies in the United States, and one of the most important benchmarks in the traditional market.
Bitcoin in the Traditional Financial Landscape
The entry of financial giants such as BlackRock into the cryptocurrency space, through products such as Bitcoin ETFs, is a significant milestone. It serves as a bridge between the world of traditional finance and the decentralised world of cryptocurrency. That movement brings greater legitimacy, liquidity and accessibility to Bitcoin, attracting institutional and retail investors who might previously have hesitated to enter the crypto market directly. A Bitcoin ETF outperforming a fund based on the S&P 500 draws attention to the potential performance of cryptocurrency and its growing relevance in the global investment portfolio.
Self-Custody vs. ETFs: Understanding the Differences
While ETFs offer a convenient form of exposure to Bitcoin's price, it is essential to understand that when you invest in an ETF, you do not own the Bitcoin itself. You own units of a fund that holds Bitcoin. That means you have no direct control over the cryptocurrency's private keys. This is where the concept of self-custody comes in, meaning the user holds and controls the private keys to their own cryptocurrency, with full autonomy over their funds.
Self-custody is the essence of the crypto philosophy, offering incomparable freedom and security. VKX Wallet, for example, is a Brazilian crypto wallet with self-custody, which means the keys to your funds stay exclusively with you. That gives you full control over your cryptocurrency. VKX Wallet also lets you buy and sell crypto by PIX in minutes, supporting networks such as BNB Chain, Polygon, Ethereum, TRON and Solana, making it easier to access and manage your digital assets securely and independently. With self-custody, you are solely responsible for your assets, removing dependence on third parties.
The Future of Cryptocurrency and the Investor's Choice
The performance of BlackRock's Bitcoin ETF is an indication of the crypto asset market's maturing and of its integration with traditional finance. It is crucial to remember, however, that the cryptocurrency market is volatile and that past returns do not guarantee future returns. The decision to invest, whether in ETFs or directly in crypto assets with self-custody, should be based on individual research, an understanding of the risks and alignment with your financial objectives.
The financial landscape is constantly evolving, and Bitcoin, with its innovations and challenges, continues to shape the future. Understanding the different ways of interacting with this asset is the first step towards making informed decisions.
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Disclaimer: This content is purely informational and educational. It should not be considered financial advice or an investment recommendation. Investing in cryptocurrency involves significant risks, and you should carry out your own research and consult a qualified financial professional before making any investment decision.
Read also
Sources
- The Cryptonomist — BlackRock's Bitcoin ETF returns beat Vanguard's S&P 500 — the comparison of IBIT's 71% against VOO's 66% in total return since the January 2024 debut
- CryptoSlate — BlackRock's Bitcoin ETF barely beat the S&P 500, after a 53% crash — IBIT's 53.30% maximum drawdown against VOO's 18.69% over the same period
Equal return, different experience
It is worth pressing this point because it is the practical lesson of the episode. When two investments deliver a similar return, what decides which was better for an actual person is the volatility of the journey.
A 53% drawdown means that at some moment someone with R$100,000 invested saw R$47,000 on the screen. An 18.69% drawdown means seeing R$81,000. The difference is not in the final result — it is in how many people sell at the bottom and never reach the final result. That is why comparing only the return figure between a volatile asset and a broad equity index is misleading, even when both figures are correct.
None of this is an argument against Bitcoin nor in favour of the S&P 500. It is an argument in favour of looking at both columns before deciding.
Disclaimer
This content is purely informational and educational. It does not constitute an investment recommendation, financial advice or an offer to buy or sell any asset. Investments in digital assets and in the stock market involve risk and may result in the loss of the capital applied. Do your own research and, if necessary, consult a qualified professional before deciding.
Frequently Asked Questions
What is a Bitcoin ETF?
A Bitcoin ETF is an exchange traded fund that allows investors to gain exposure to Bitcoin's price without needing to buy and store the cryptocurrency directly, making access to that asset easier for traditional market investors.
What is the difference between holding a Bitcoin ETF and owning Bitcoin directly?
With a Bitcoin ETF, you invest in a fund that holds Bitcoin, but you own neither the cryptocurrency itself nor its private keys. When you own Bitcoin directly, especially through a self-custody wallet such as VKX Wallet, you have full control over your private keys and, consequently, over your digital assets.
Does VKX Wallet offer Bitcoin ETFs?
No, VKX Wallet is a self-custody wallet that lets you buy, sell and store your cryptocurrency directly, keeping full control over your private keys and digital assets. It focuses on the independence and security that self-custody provides, allowing transactions via PIX across several networks.
What does self-custody mean in the context of cryptocurrency?
Self-custody means the user holds and controls the private keys to their own cryptocurrency, with full autonomy over their funds. That ensures only the owner can access and move their assets, with no need for intermediaries.