Crypto Has Potential to Shake Up Financial Markets, says BlackRock CEO

BlackRock, the world’s largest asset manager, is bullish on digital payments and crypto. In his annual letter to investors, BlackRock Chairman and CEO Laurence Fink said that despite the collapse of FTX and other firms in the crypto industry, interesting things are still happening in the space. Fink pointed out that in many emerging markets like India, Brazil, and parts of Africa, digital payments are advancing financial inclusion and bringing down costs. However, Fink noted that developed markets like the US are lagging behind in innovation, leaving payment costs high.

“In many emerging markets – like India, Brazil and parts of Africa – we are witnessing dramatic advances in digital payments, bringing down costs and advancing financial inclusion… By contrast, many developed markets, including the US, are lagging behind in innovation, leaving the cost of payments much higher,” said Fink.

Fink also addressed the potential of digital asset technology to transform financial markets, saying that while crypto needs regulation due to its elevated risks, the tokenization of asset classes has the potential to drive efficiencies in capital markets, shorten value chains, and improve cost and access for investors. “For the asset management industry, we believe the operational potential of some of the underlying technologies in the digital assets space could have exciting applications. In particular, the tokenization of asset classes offers the prospect of driving efficiencies in capital markets, shortening value chains, and improving cost and access for investors,” said Fink.

According to a report by CNBC, BlackRock has been showing interest in crypto for some time now. In 2018, the firm formed a team to explore ways to invest in the crypto market, and in 2020, the firm added bitcoin futures as an eligible investment to two of its funds. BlackRock has also filed for two bitcoin ETFs with the US Securities and Exchange Commission (SEC), signaling its growing interest in the crypto space.

In conclusion, BlackRock sees the potential of digital payments and crypto, especially in emerging markets, and believes that digital asset technology can transform financial markets. While regulatory oversight is needed, BlackRock is exploring ways to invest in the crypto market and has filed for bitcoin ETFs, indicating the firm’s growing interest in the space.

BlackRock’s Involvement in the Crypto Space

BlackRock is the world’s largest asset manager, with over $8.7 trillion in assets under management. The firm has not yet invested directly in cryptocurrencies but has shown an interest in the technology behind them. In 2018, BlackRock established a working group to study cryptocurrencies and blockchain technology. The group concluded that while the firm was not ready to invest in cryptocurrencies, it should continue to monitor the space. BlackRock has also filed documents with the US Securities and Exchange Commission (SEC) stating that two of its funds may invest in Bitcoin futures.

Massive Potential

BlackRock sees the potential of digital payments and crypto, especially in emerging markets, and believes that digital asset technology can transform financial markets. While regulatory oversight is needed, BlackRock is exploring ways to invest in the crypto market and has filed for bitcoin ETFs, indicating the firm’s growing interest in the space.