BlackRock made headlines this February when sources revealed the firm is paving the path to offering trading in crypto assets to institutional clients. The same has been confirmed lately by its CEO Larry Fink in a letter to shareholders even though he called Bitcoin a money laundering index about a couple of years ago.
Fink mentioned in the letter that a digital payment system can now enhance international transactions settlement with reduced corruption and money laundering risks. However, investors need to better understand the firm, what it means by crypto trading and why the news has hit the headlines.
BlackRock cannot be denied being the largest asset manager in the world. It manages assets worth more than $10 trillion and is based in New York. It is simultaneously called an institutional powerhouse. It manages many consumer-facing products and includes more than 120 mutual funds.
Many are familiar with the firm for its ETF division that constitutes the iShares family such as the iShares Core S&P 500 ETF, which is the second-largest in the world pregnant with assets worth more than $327 billion.
It is true that if BlackRock makes the slightest move, it becomes important news for investors. Cryptocurrency is now the major buzz in the financial market and the information of the firm about making ways to facilitate crypto trading is naturally a headline. However, nothing official has yet been announced.
Earlier, Coindesk revealed the firm intends to use its platform as a crypto trading vehicle and the fund manager may establish credit facilities through which clients can be loaned.
Cryptocurrency may find some additional validation with the move of BlackRock to offer the asset for investment. The uphill battle of the segment may be reduced to some extent related to acceptance of it while paving the path to becoming a replacement for traditional fiat currency. Hence, it is a time to cherish for crypto enthusiasts.
BlackRock may change the landscape of the crypto segment by offering clients to invest in it through its platform. Other big names including Fidelity and Schwab too are learned to rushÂ to embrace the opportunity. Many more will follow, undoubtedly.
Cryptocurrency is a digital currency based on blockchain technology. The transactions are maintained on a public digital ledger anonymously. Sending and receiving crypto coins from one corner to another across the world is faster and cheaper compared to fiat currencies. It is decentralized and not under the control of any government, bank or authority. Bitcoin was the first cryptocurrency and was launched in 2009.