In a pivotal moment that sent tremors through the digital currency landscape, BlackRock, the behemoth asset manager with nearly $10 trillion in assets under management, has intensified its foray into the cryptocurrency domain. In a move that could unlock a $15 trillion crypto boom.
This entrée was marked by the firm’s filing for an exchange-traded fund (ETF) centered on the spot bitcoin market, which catalyzed a notable ascent in bitcoin’s value, with the flagship cryptocurrency being up nearly 20% over the past week. The broader cryptocurrency market rallied as well, to now have a market capitalization of $1.17 trillion.
Cryptocurrencies like Ethereum ($ETH), $BNB, $XRP, and even meme-inspired cryptocurrencies all rallied as a result, with some like $PEPE outperforming the wider market.
Adding to the sense of momentum, a survey conducted by Laser Digital, the digital assets subsidiary of banking colossus Nomura, unveiled that a staggering 96% of professional investors who collectively manage close to $5 trillion are harboring a keen interest in injecting capital into cryptocurrencies.
Jez Mohideen, the Chief Executive of Laser Digital, conveyed in a statement reported by CoinDesk, that the study reveals “that the majority of institutional investors surveyed saw a clear role for digital assets in the investment management landscape, and the benefits they can bring, such as greater diversification of portfolios.”
The survey encompassed 303 professional investors, and the data painted a clear picture: 82% of the participants expressed a positive outlook on both BTC and ETH, and 88% indicated that either they or their clientele are contemplating investments in cryptocurrencies.
In a seemingly strategic move, BlackRock filed for a spot Bitcoin ETF with the .S. Securities and Exchange Commission (SEC), with popular cryptocurrency exchange Coinbase serving as its custodial partner for the fund. The move was followed by several large financial institutions filing for their own spot Bitcoin ETFs, including Invesco, WisdomTree, and more.
Notably not everyone is sold on BlackRock’s proposed spot Bitcoin ETF. Simon Peters, a market analyst at eToro, offered a note of caution saying that the potential for the product to “move the market is not hugely clear and reliant on demand.”
Peters added that BlackRock manages “an eye-watering amount of the world’s capital so the success of a spot ETF could unlock enormous amounts of liquidity in the market for bitcoin.”
He did, however, highlight that the ETF comes with stringent stipulations, such as the incorporation of surveillance data sharing to thwart market manipulation—a provision that may not sit well with ardent supporters of the decentralized nature of bitcoin.
Featured image via Unsplash.