BlackRock (NYSE:BLK), the world’s largest asset manager, with around $5.4 trillion in assets under management, is said to be considering getting into the cryptocurrency market, according to a report in Financial News.
On 26 February 2018, BlackRock, as part of its Global Weekly Commentary, made the following conclusion about the “crypto craze”:
We see cryptocurrencies potentially becoming more widely used in the future as the markets mature. Yet for now we believe they should only be considered by those who can stomach potentially complete losses.
Now, however, the London-based Financial News, says that, according to people familiar with the matter, BlackRock, “has created a team from different parts of the business to investigate cryptocurrencies and their underlying infrastructure, blockchain”, and that this working group “will examine whether BlackRock should invest in bitcoin futures” as well as look “at what BlackRock’s competitors are doing with cryptocurrencies and how that could impact its business.”
If this story is true, it would mark a huge turnaround for the company after its CEO, Larry Fink, at an Institute of International Finance (IIF) meeting, on 13 October 2017, called Bitcoin an “index of money laundering”:
“Bitcoin just shows you how much demand for money laundering there is in the world… That’s all it is.”
Fink’s comments came on the same day that Jamie Dimon, the chairman and CEO of JPMorgan Chase, said that people who buy bitcoin are “stupid”:
“If you’re stupid enough to buy it, you’ll pay the price for it one day… The only value of bitcoin is what the other guy’ll pay for it… Honestly I think there’s a good chance of the buyers out there are out there jazzing it up every day so that maybe you’ll buy it too, and take them out.”
This is what Ran NeuNer, the host of CNBC Africa’s “Crypto Trader” show, tweeted about the news of BlackRock potentially getting into crypto:
The difference btw a future & an ETF is that an ETF has to buy the underlying taking liquidity out the market.
When the World’s biggest ETF company is looking at Crypto and the SEC has no real reason to block the next ETF, it could get a little excitinghttps://t.co/eFAYwnGdyN
— Ran NeuNer (@cryptomanran) July 16, 2018
According to a report in The Financial Times on 3 Jan 2018, “BlackRock’s iShares ETF arm set a fresh record for growth with net new business inflows of $246bn in 2017, an increase of 76 per cent on the $140bn gathered over the previous year” and BlackRock is expecting ETF assets globally to “double by 2022 from the current level of $4.5tn.”
BlackRock manages assets for its clients in North and South America, Europe, Asia, Australia, the Middle East and Africa. Its clientele includes “corporate, public, union and industry pension plans; governments; insurance companies; third-party mutual funds; endowments; foundations; charities; corporations; official institutions; sovereign wealth funds; banks; financial professionals; and individuals worldwide.” It employs around 13,000 people, and has offices in 30 countries.