Cailianshe: The world's largest asset management company BlackRock is expected to make a big move! Bitcoin's rally adds new "fuel"

Source: Cailianshe

Cailian Press (Shanghai, editor Bian Chun) reported that Bitcoin, which is gaining popularity, is attracting the attention of more and more institutional investors, and even the world's largest asset management company BlackRock has shown interest in it. Public documents show that BlackRock, which manages trillions of dollars in assets, is expected to make a big move into the field of crypto assets.

The Federal Reserve’s favorite medium for market operations, BlackRock, may be allocating bitcoin futures through some of its funds, according to two filings with the U.S. Securities and Exchange Commission (SEC).

The document shows that BlackRock will provide clients with exposure to Bitcoin futures through its BlackRock Strategic Income Opportunities Fund and BlackRock Global Allocation Fund Inc.

BlackRock noted that the fund's investments are limited to bitcoin futures that are traded on commodity exchanges registered with the U.S. Commodity and Futures Trading Commission (CFTC) and settled in cash, highlighting the limited nature of the bitcoin assets that Wall Street can trade.

At the same time, BlackRock also detailed the potential risks of investing in Bitcoin futures in the regulatory filing. “Because the Bitcoin futures market is relatively new, fund investments in Bitcoin futures may involve the risk of insufficient liquidity, as the trading volume of Bitcoin futures is not as high as other futures.”

BlackRock is also reportedly seeking to hire a vice president of blockchain, another sign of its foray into the bitcoin space.

Changing attitudes

This is the first time that BlackRock has mentioned "Bitcoin" in a regulatory filing. Although the document itself does not explicitly indicate that the asset management giant is about to buy Bitcoin futures, it at least shows that it has paved the way for possible Bitcoin investment.

In fact, as early as 2018, BlackRock formed a team to explore potential investments in digital currencies and blockchain. However, at the time, the company's CEO Larry Fink was not so optimistic about Bitcoin and doubted customers' enthusiasm for Bitcoin and similar products.

Fink said at a symposium last month that Bitcoin is gaining legitimacy as an asset class, but warned: "Bitcoin must be validated in many markets to determine whether it will always be legitimate."

Rick Rieder, BlackRock's chief investment officer for global fixed income, also said last month that he maintained a relatively sober view of this popular virtual asset, but he believed that the cryptocurrency "will continue to exist." In an interview last year, he said that the demand for Bitcoin is obvious, but this asset will take a long time to be verified before it is suitable for investors to trade.

The asset management giant, which manages about $8.7 trillion in assets, has shown interest in bitcoin futures as bitcoin prices have been rising parabolically, with the pullback in recent days highlighting the inherent volatility of the virtual asset. The support of large institutional investors has been "indispensable" to bitcoin's latest bull run, and if BlackRock enters the game, it will provide a new catalyst for the cryptocurrency to rise further.

Despite the recent pullback, Bitcoin’s rally remains remarkable: It’s up 21% so far this year after surging more than 300% in 2020. The most-active bitcoin futures on CME Group are up nearly 19% so far this month and 192% over the past three months.