Sunday, June 16, 2024

Crypto: democratising Investing

According to CEO Larry Fink, BlackRock’s entry into the cryptocurrency space aligns with the company’s broader mission of providing efficiency and transparency in investment products. Fink stated that BlackRock believes in democratising investing and that the role of exchange-traded funds (ETFs) has already begun transforming the investment landscape.

BlackRock made headlines when it applied for a bitcoin ETF on June 15. This move not only led to a rally in cryptocurrencies but also triggered similar filings from other asset managers. Notably, BlackRock’s initial filing for the iShares Bitcoin Trust did not include a management fee.

While the Securities and Exchange Commission (SEC) has previously rejected numerous applications for similar funds, the involvement of BlackRock and the proposed surveillance sharing agreement in their filing are seen as significant developments within the crypto industry. These actions are perceived as an indication of shifting momentum.

Fink emphasized that BlackRock is actively collaborating with regulators to ensure that any product associated with the company’s name is secure and protected, especially in a new market like cryptocurrencies.

Although Fink had previously expressed criticism towards crypto, he highlighted that client interest and the high cost of transactions prompted BlackRock to explore opportunities in the space. Additionally, Fink acknowledged the potential diversification benefits of cryptocurrencies within investor portfolios, emphasizing their differentiating value and international nature, which transcends any specific currency.

Fink refrained from discussing the specific details of the spot bitcoin ETF due to SEC restrictions on public commentary during the filing process.

On a separate note, BlackRock reported its second-quarter results, revealing adjusted earnings per share of £7 on £3.7 billion in revenue. The company’s assets under management have now surpassed £7 trillion.

Source : CNBC

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