Posted 1 month ago | by Catoshi Nakamoto
The CEO of BlackRock the largest asset manager in the world, Larry Fink has stated that he is not seeing significant institutional inflows or interest in cryptocurrency. However, Fink said he believes that cryptocurrency has the potential to evolve into a “great asset class.”
"It may become a great asset class and I do believe this can become a great asset class," says Larry Fink. "I don't believe we should think about #crypto as a substitute of currency."#btc pic.twitter.com/ykGNhZqVT7
— Squawk Box (@SquawkCNBC) April 15, 2021
Goldman Sach’s CEO David Solomon stated a similar message in an earnings call this week.
The CEO of BlackRock, a firm with over $7 trillion in assets under management (AUM), recently said that “cryptocurrency might become a great asset class.”
Both firms state there is “little” interest among institutional investors. Although, just this week, Rothschild Investment and Brevan Howard, a European hedge fund, pledged to buy almost 90 million worth of cryptocurrency combined. Rothschild Investment has purchased $4.75 million worth of Grayscale Ethereum Trust Shares or 265,302 shares, according to an SEC filing.
Bloomberg reported that Brevan Howard is preparing to invest $84,000,000 in digital assets, representing 1.5% of its $5.6 billion hedge fund. Jonny Steindorff and Tucker Waterman, co-founders of crypto investment firm Distributed Global, will oversee the companies allocation. Brevan Howard’s co-founder, Alan Howard, has previously invested his money into cryptocurrencies. The firm has also acquired a 25% stake in One River Asset Management another firm that earlier this year made one of the largest undisclosed cryptocurrency investments in history, according to crypto exchange Coinbase, as Bitboy Crypto reported.
The managing director and chief investment officer of BlackRock, Rick Rieder, previously said that Bitcoin would replace gold in November.
Goldman Sachs has also recently discussed selling Bitcoin Futures contracts, announcing they have restarted their cryptocurrency trading desk, and that the firm would begin dealing Bitcoin Futures and non-deliverable forwards for clients just last month.
Blackrock’s Fink told CNBC that while he remains optimistic about cryptocurrency he disagrees with the idea that institutions are flooding into the industry. Fink said:
“Our broad-based client relationships have shown little interconnectivity on the conversation on #crypto other than a fascination.”
BlackRock is seen as the world’s leading asset manager, with over $7 trillion in assets under management at the end of 2019 alone according to Market Watch. To put that into perspective for you if BlackRock were to allocate only 1% of its assets into Bitcoin that would be an estimated $74 billion flooding into the market.
Despite Blackrock and Goldman Sach’s FUD, firms like Rothschild Investment have reported owning over 38,000 shares of the Grayscale Bitcoin Trust (GBTC) paper Bitcoin. In addition, One River was responsible for the largest undisclosed purchase last year. One River has been one of the largest investors in Bitcoin and cryptocurrency thus far quietly buying more than $600 million in cryptocurrencies while joining forces with Alan Howard, the co-founder of Brevan Howard Asset Management, as Bitboy Crypto reported.
Earlier this year, One River’s CEO Eric Peters made the case for cryptocurrencies in a post on One River’s website, entitled “The Case for Digital Assets.” In the blog post, Peters states his long-term view that cryptocurrencies are the technology of the future. One River has previously pledged to accumulate a total of $1 billion worth of cryptocurrency.
“Owning these assets is a mere toehold to the future, a deposit on the view that everything we know about financial intermediation and its relationship to centralized policy will change in ways we cannot yet foresee,” Peters said.
As a further observation, these comments directed against cryptocurrency by Goldman Sachs and Blackrock come after Coinbase going public just this week.
Bitcoin is currently trading at [FIAT: $60,934.48] UP 0.3% in the last 24 hours, according to Coingecko at the time of this report.