BlackRock's US Equity ETF Head Says Bitcoin's Diversifier Role 'Still Very Much Holds' As AI's Best Bets Move 'Outside Of Tech'
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BlackRock's Head of Equity ETFs Jay Jacobs said AI opportunities increasingly lie beyond traditional tech sectors.
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Materials, utilities and digital infrastructure could benefit from AI's physical buildout.
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Jacobs argued Bitcoin's diversification case remained intact despite growing institutional ownership.
Wall Street may have changed who owns Bitcoin, but it hasn't changed why investors own it, according to BlackRock's (BLK) U.S. Head of Equity ETFs, Jay Jacobs.
Bitcoin's (BTC) role as a portfolio diversifier survived its institutional takeover, and Jacobs said the best opportunities in AI now sit outside the technology sector.
Speaking on the Anthony Pompliano podcast on Thursday, Jacobs explained that the biggest mismatch in artificial intelligence was that demand compounded, but supply could not. Large language models (LLMs) were "already [writing] code for themselves to improve," he said, and companies were deciding in "days, weeks" how much to spend, but physical inputs moved much more slowly.
New copper supply took years, building a zinc mine for photonics takes years, and "the fabs take about four years," he noted.
Beyond The Tech Sector
According to Jacobs, that gap was why investors were likely looking in the wrong place. "Too many people still view AI as a tech theme," he said. "It's a healthcare theme, it's a legal theme, it's a consumer theme."
BlackRock, the largest asset manager with $14 trillion in assets under management (AUM), mapped the "AI value chain," running from power companies and data centers through chip manufacturers, data owners and model developers.
Some of the best opportunities sit "outside of tech right now," Jacobs said, in materials, utilities and real estate. "It's easy to scale software... but it's not so easy to scale compute, which has a tremendous physical footprint."
The firm split that physical layer into separate products, including power and digital infrastructure ETFs.
Bitcoin Still A Diversifier
Jacobs pushed back on the idea that Wall Street ownership had changed what Bitcoin (BTC) was. When investors worried about geopolitics or "fiat currency, maybe debasement, Bitcoin should benefit," he said, adding that stocks and bonds often struggled under the same conditions.
"That fundamental diversifying nature of Bitcoin, we believe, still very much holds, even as the investor base has shifted over the last few years," Jacobs said.
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