BlackRock CEO: "Very Optimistic" About Bitcoin

On March 29, BlackRock CEO Larry Fink was “pleasantly surprised” by the performance of the Bitcoin ETF and reiterated his “very optimistic” attitude towards the long-term viability of Bitcoin.

Changing attitudes

Fink said in an interview with Fox Business on March 27: "IBIT is the fastest growing ETF in the history of ETFs. In the history of ETF development, no product has accumulated assets as quickly as IBIT. I am very surprised that we are now creating a more liquid and transparent market. Before we submitted the application, I never expected that we would see this kind of retail demand." Fink also stated: "I am very optimistic about the long-term viability of Bitcoin."

According to Farside Investors, IBIT performed strongly in the early stages of trading, attracting $13.5 billion in inflows in the first 11 weeks, with the highest single-day inflow reaching $849 million on March 12. IBIT's average daily inflows were slightly more than $260 million.

Additionally, BlackRock CEO Larry Fink said in an interview with Fox Business that even if the U.S. Securities and Exchange Commission (SEC) designates Ethereum as a security, it is still possible to launch an Ethereum ETF.

When asked if BlackRock would still list an Ethereum spot ETF if Ethereum is deemed a security, Fink answered in the affirmative. Currently, eight potential issuers, including BlackRock, have submitted Ethereum spot ETF applications to the SEC. The SEC's final decision will be made in May.

However, Larry Fink's attitude towards Bitcoin has only changed in recent years.

On January 15, Larry Fink made a significant shift in his attitude towards Bitcoin, arguing that Bitcoin is “bigger than any government.” Fink pointed out that Bitcoin can be used as a long-term store of value if people are concerned about government instability or economic manipulation.

But this is in stark contrast to his views in 2017, when he and JP Morgan CEO Jamie Dimon criticized Bitcoin, with Fink going so far as to call it "an indicator of money laundering."

Big Whales Enter the Game

BlackRock, founded in 1988, is currently the world's largest asset management, risk mitigation and consulting company.

According to relevant reports, BlackRock's assets under management reached 10 trillion US dollars in the fourth quarter of 2023. It can be said that even if it did not launch a Bitcoin spot ETF, as a towering tree in the global financial industry, BlackRock would still firmly sit in the top spot.

In fact, BlackRock began to take an interest in the crypto industry and blockchain technology as early as a few years ago, but there were many challenges at the time. First, the market volatility was relatively large, and second, there was a lack of reasonable supervision. Market rules had not yet been fully established. Moreover, over the past decade, the SEC has been rejecting applications for spot Bitcoin ETFs due to concerns about market manipulation, so no obvious major actions have been taken.
However, on January 11, 2024, several institutions led by BlackRock launched the first batch of Bitcoin spot ETFs in the United States, called iShares Bitcoin Trust (IBIT), which directly reversed the embarrassing situation in which spot Bitcoin ETF applications had been rejected over the past decade and opened a new chapter in the development of encryption.

It’s no exaggeration to say that BlackRock’s unexpected application for a Bitcoin ETF has reignited interest in cryptocurrency trading tools after many thought the project was doomed to fail — even if it had the iShares Bitcoin Trust approved as just one of hundreds of ETFs it manages.

But it is undeniable that the Bitcoin ETF is very important because it allows more institutions to gain exposure to Bitcoin by holding stocks such as BlackRock's iShares or WisdomTree's BTCW, rather than directly holding Bitcoin. This means that retail and institutional investors can invest in Bitcoin through index funds.

Fink's View

Previously, Fink placed himself in the “Jamie Dimon camp” — the JPMorgan Chase CEO is a well-known cryptocurrency skeptic — and said the world doesn’t need “a new international currency.” At the time, Fink also said Bitcoin could undermine the dollar’s ​​status as a reserve currency.

However, Fink’s attitude has now undergone a major change, as many in the traditional financial field are re-examining blockchain, especially the “tokenization” of real-world assets such as stocks and bonds.

On January 14, 2024, BlackRock CEO Larry Fink said in an interview that he hopes to tokenize stocks, bonds and all financial assets he can.

Then, on March 20, BlackRock announced the launch of its first tokenized fund issued on a public blockchain, the BlackRock USD Institutional Digital Liquidity Fund (BUIDL).

It is reported that BUIDL will subscribe through Securitize, a digital asset securities company focusing on RWA, to serve qualified investors, and the funds will be held by the official custodian Bank of New York Mellon. The fund will invest 100% of its total assets in cash, U.S. Treasury bonds and repurchase agreements, allowing investors to earn income while holding tokens on the blockchain.

According to the announcement, the minimum initial investment in the fund is $5 million. BUIDL seeks to provide a stable value of $1 per token, and owning tokens will generate dividends. BlackRock will pay the daily accrued dividends directly to investors' wallets as new tokens. In short, investors can obtain fund returns through token holdings while avoiding complicated procedures and storage costs.

Regarding this new product, BlackRock CEO Larry Fink said bluntly, "We believe that the next step will be the tokenization of financial assets, which means that every stock and every bond will have its own underlying QCIP. It will be recorded in each investor's general ledger, but most importantly, we can customize strategies that suit everyone through tokenization."

Since the approval of the Bitcoin spot ETF, BlackRock has become a weather vane in the minds of crypto practitioners.

Final Thoughts

In short, as the CEO of BlackRock, the world's largest asset management company, Fink's attitude and views on cryptocurrency have an important influence and guiding role on the entire industry. His transformation also reflects the maturity and development of the cryptocurrency market, as well as the adaptation and transformation of traditional financial institutions.

Fink's vision is that cryptocurrency will become a global currency that can transcend national borders and political restrictions to achieve greater efficiency and freedom. He said: "I think this is a very exciting era. We are witnessing the birth of a new currency that will change our world."