BlackRock Studying Crypto but is Held Back by Volatility
- BlackRock continues to monitor the cryptocurrency industry but is wary of the volatility
- In an annual shareholder meeting, BlackRock CEO Larry Fink discussed crypto assets
BlackRock Annual Shareholder Meeting Held After Market Crash
BlackRock, the largest asset manager in the world with $9tn of assets under management, recently held a shareholder meeting during which the participants discussed the looming crypto market. Larry Fink, the Chief Executive of BlackRock, commented the company is closely following the developments in the crypto space. It is however sitting out due to heightened volatility.
“The firm has monitored the evolution of crypto assets. We are studying what it means, the infrastructure, the regulatory landscape,” Mr. Fink told at the annual meeting. He also noted that BlackRock’s forward-looking approach to investing could, at some point, accommodate cryptocurrencies as they could potentially play a role as a long-term investment and an asset class similar to gold. But for the time being, he continued, it is too early to know whether Bitcoin and other digital assets were “just a speculative trading tool”.
The annual shareholder meeting was held after the market crash in mid-May when Bitcoin lost over 50% of its value and reached levels near the $30,000 mark. On May 19, bitcoin lost 30% of its value, while the entire cryptocurrency market erased more than $500bn.
Larry Fink’s Turnaround With Regards Bitcoin
BlackRock’s Larry Fink, whose net worth exceeds $1.1bn, this year has shifted his perspective on the crypto asset class. He’s an outspoken critic who called Bitcoin an “index of money laundering” in 2017. However, a couple of months ago praised Bitcoin and said he was “fascinated” by it. He expected the digital asset market could become a “great asset class”.
Moreover, BlackRock has indirectly invested in Bitcoin through its stake in MicroStrategy. BlackRock funds own 15.24% of the cloud software company led by the popular Bitcoin evangelist Michael Saylor. MicroStrategy has more than 70% of its $4.5bn market cap invested into Bitcoin.
And just this last quarter, BlackRock revealed via its SEC filing it had invested in Bitcoin futures and even turned a profit. The asset manager had traded 37 futures contracts tied to Bitcoin, worth $6.15mn, which had appreciated by $360,458.
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