BlackRock’s Bitcoin Strategy: Mining Investments and ETF Proposals

The fact that BlackRock, the biggest asset management in the world, has been making substantial movements in the Bitcoin area recently demonstrates the firm’s optimism over the future of the cryptocurrency. This article dives into recent business endeavours undertaken by BlackRock, such as investing in Bitcoin mining businesses and putting out a proposal for a Bitcoin exchange-traded fund (ETF).

Investment Opportunities in Bitcoin Mining

BlackRock has achieved a key place for itself in the cryptocurrency mining industry. The massive investment firm is now the second-largest shareholder in four of the top five Bitcoin miners in terms of market value. To be more specific, as of the 30th of June, BlackRock Fund Advisors boosted their shares in these mining businesses. Notable investments were made in Riot Platforms Inc., Marathon Digital Holdings, Cipher Mining, and Terawulf.

Riot Platforms, Inc. (NASDAQ: RIOT) is a global leader in Bitcoin-centric infrastructure. The company is committed to making a positive impact through innovation and community partnerships. Riot specializes in Bitcoin mining and digital infrastructure, with vertically integrated operations that include data center hosting in central Texas and electrical engineering in Denver, Colorado. 

Marathon Digital Holdings is a digital asset technology firm with a focus on bolstering the Bitcoin ecosystem. The company is on track to become one of North America’s largest and most eco-friendly Bitcoin mining operations.

Cipher Mining is a U.S.-based industrial-scale Bitcoin mining firm committed to fortifying the Bitcoin network’s infrastructure. With a management team experienced in technology, fintech, and finance, the company aims to provide a robust foundation for Bitcoin’s future growth.

Terawulf is a U.S.-based Bitcoin mining firm dedicated to advancing a zero-carbon future. The company owns and operates integrated mining facilities in key U.S. locations, focusing on sustainable community benefits and attractive investor returns.

A proposal for a Bitcoin exchange-traded fund (ETF)

BlackRock’s newly unveiled Bitcoin exchange-traded fund (ETF) has captured significant attention. An ETF is an investment vehicle designed to mirror the behavior of a specific asset or group of assets. For Bitcoin, such an ETF would allow investors to follow the cryptocurrency’s price fluctuations without the necessity of holding it directly.

BlackRock’s position as the biggest asset manager in the world gives its application credence, despite the U.S. Securities and Exchange Commission’s (SEC) past reluctance to approve Bitcoin ETFs. Financial industry professionals are optimistic that BlackRock’s ETF proposal will be approved in the near future, including Galaxy Digital CEO Mike Novogratz.

The idea of a Bitcoin ETF is not new, but BlackRock’s latest proposal has reopened the debate over whether such an investment vehicle could ever operate.It is important to note that the SEC has in the past given its blessing to exchange-traded funds (ETFs) that follow cryptocurrency futures or corporations with indirect crypto exposure. On the other side, the intention of BlackRock’s proposition is to follow the spot price of bitcoin.

The final word

The increasing interest shown by financial institutions in bitcoin is highlighted by BlackRock’s recent forays into the space, which include investments in mining operations and suggestions for exchange-traded funds. BlackRock is making some aggressive efforts in this field, and although the future of Bitcoin is still unclear, these initiatives might possibly have an effect on the way cryptocurrency investments develop.

BlackRock’s endeavours serve as a testimony to Bitcoin’s expanding importance in the financial landscape and are being watched closely by the cryptocurrency sector as it awaits the SEC’s verdict on the proposed ETF. The effects that these projects will have on the bitcoin market as a whole won’t be known for some time.

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BlackRock CEO Highlights Digital Assets and Tokenization

The Chief Executive Officer of the American investment firm BlackRock, Larry Fink, sent an annual letter to the board of directors in which he emphasized the possibilities of digital assets and tokenization for the asset management business. Fink made notice of the continued interest in these kinds of assets, notwithstanding the disaster that occurred with FTX, and he brought attention to the “interesting changes” that have been taking place in this sector.

Particularly, Fink mentioned the “dramatic gains” that have been made in digital payment systems, which are contributing to the progression of financial inclusion in developing countries such as India, Brazil, and Africa. This is crucial since the residents of these communities may not have access to standard financial institutions due to a lack of availability.

Tokenization, which refers to the act of putting assets or securities on a blockchain as digital tokens, may also give advantages, like enhanced liquidity and transparency. It’s possible that BlackRock, which is the biggest asset manager in the world, will be in a good position to capitalize on these trends in the years to come.

It is important to remember that BlackRock has in the past indicated that it is interested in the bitcoin and blockchain industries. In 2018, the corporation established a working group to investigate possible applications for blockchain technology. Two years later, in 2020, the company raised its interests in two Bitcoin mining companies that are publicly listed.

In general, Fink’s letter sheds insight on the increasing interest that the asset management sector is showing in digital assets and tokenization, as well as the potential that these two trends have. It will be fascinating to see how BlackRock and other big financial organizations adapt to new technological developments and integrate these trends into their business plans as technology continues to evolve.


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Circle Has Started Building New Reserve Funds With BlackRock

Circle, the Web3.0 unicorn that is in charge of the issuance and maintenance of the USD Coin (USDC) stablecoin, has revealed it has started building a new and robust reserve fund dubbed the Circle Reserve Funds. 


According to Jeremy Fox-Geen, the company’s Chief Financial Officer, the new Circle Reserve Funds are lodged with BlackRock, further deepening its relationship with the world’s largest asset management firm.

The new reserve fund will be managed by BlackRock advisors and it will predominantly be dominated by cash and short-dated US Treasuries. As Jeremy noted, as the existing USDC Treasury matures, funds from the reserve treasury will be pulled to secure the replacement of the reserve to continually guarantee 1:1 access to users’ funds.

“The Circle Reserve Fund is only available to Circle. As our existing Treasury holdings mature, the proceeds will be used to purchase new Treasuries by the Circle Reserve Fund,” Jeremy wrote in the official announcement, “We began this process on November 3, 2022, and expect to be fully transitioned by the end of Q1 2023. The Fund is custodied at Bank of New York Mellon, which already serves as the custodian for the Treasuries that comprise the USDC reserve today.”

Stablecoin issuers are uniquely poised for extra scrutiny from regulators, market observers, and the ecosystem at large. While Circle has not been embroiled in any form of price manipulation or improved alternative asset backing for its stablecoin, its major competitor, Tether Holdings have had to respond to lawsuits and allegations directly claiming its trading and reserve asset’s impropriety.

Circle’s USDC is currently the world’s second-largest stablecoin after Tether and it has a market capitalization of $42.2 billion at the time of writing, riding on its growing utility. Per the plans to bolster its reserve, USDC will now be at a vantage point to truly live up to its name and remain stable across the board.

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BlackRock Bitcoin Private Trust to Be Benchmarked by Kraken’s CF Benchmarks Bitcoin Index

The world’s largest investment management firm BlackRock’s Bitcoin Private Trust will use the Kraken subsidiary CF Benchmarks Bitcoin Index as a benchmark for issuance, The Block reported.

Last month, BlackRock partnered with Coinbase to provide its institutional clients with cryptocurrency trading services. A few days later, the company announced the launch of the Bitcoin Private Trust, a Bitcoin Spot.

The product will seek to track Bitcoin’s performance and will bring fewer fees and debt to the trust company.

CF Benchmarks is a member of the Crypto Facilities group of companies and a member of the Payward Group of owners and operators of cryptocurrency exchange Kraken Exchange.

“Despite the sharp decline in the digital asset market, we continue to see strong interest from some institutional clients on how to leverage our technology and product capabilities to efficiently and cost-effectively access these assets,” BlackRock said in a statement.

The investment firm holds more than $10 trillion in assets under management (AUM).

Sui Chung, CEO of CF Benchmark, noted that institutional interest has increased over the past few months compared to six months ago and added that:

“The understanding of digital assets themselves is much greater than it was, people we talk to now understand the difference between bitcoin and ether.”

CF Benchmarks is trying to become the MSCI index of the crypto world.

The S&P Dow Jones Indices, a global leader in providing investable and benchmark indices to the financial launched index funds for cryptocurrencies in 2021.

BlackRock has long been focused on the crypto space, and the financial giant said its core focus in the industry remains on permissioned blockchains, stablecoins, cryptoassets, and tokenization.

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BlackRock Launches Bitcoin Private Trust after Building Partnership with Coinbase

Days after BlackRock, the world’s largest investment management company in the world, entered into a partnership with Coinbase to offer its institutional clients access to cryptocurrency trading services, the firm announced the launch of a spot Bitcoin Private Trust. 


The company said the new product will be available to its institutional clients in the United States. The product will seek to track the performance of Bitcoin and will come with fewer expenses and liabilities for the trust in general. 

While the first half (H1) of the year was filled with a lot of uncertainty as it concerns investment in the digital currency ecosystem, BlackRock said it has continued to see significant demand from clients that want exposure to digital currencies by leveraging its technology and market expertise.

The investment company, which holds more than $10 trillion in Assets Under Management (AUM), said it couldn’t resist providing an avenue to help its clients make the most secured investment in crypto should they have to. The company said the reason why the trust product is focused on Bitcoin is not far-fetched and is based on the fact that the digital asset is the oldest and most liquid of all cryptocurrencies.

While it was not made clear whether the spot Bitcoin private trust product has any affiliations with Coinbase Global, BlackRock did acknowledge that its clients will be able to leverage “Coinbase’s comprehensive trading, custody, prime brokerage, and reporting capabilities, common clients will be able to manage their bitcoin exposures alongside their public and private investments.”

BlackRock has long had its eye on the crypto sector and the financial behemoth said its core focus in the industry still remains permissioned blockchains, stablecoins, cryptoassets, and tokenization.

With the backing of the most revered cryptocurrency exchange in the US, BlackRock hopes it will be able to provide its clients the convenience they need to bet on crypto in a safe and regulated manner.

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BlackRock to Boost Crypto Access Points through Partnership with Coinbase

BlackRock, the globe’s largest asset manager, has teamed up with crypto exchange Coinbase to provide institutional investors with new crypto access points.

Through the strategic partnership, BlackRock’s Aladdin will be connected with Coinbase Prime to provide institutional investors with direct and seamless access to crypto, beginning with Bitcoin (BTC).

Joseph Chalom, the global head of strategic ecosystem partnerships at BlackRock, pointed out:

“Our institutional clients are increasingly interested in gaining exposure to digital asset markets and are focused on how to efficiently manage the operational lifecycle of these assets.”

With assets under management clocking $10 trillion by the end of last year, BlackRock  has emerged as a significant global player to the extent that it has been dubbed the “fourth branch of government.”

Therefore, Aladdin, the end-to-end investment management platform of BlackRock, seeks to boost crypto adoption among institutional investors. Chalom added:

“This connectivity with Aladdin will allow clients to manage their bitcoin exposures directly in their existing portfolio management and trading workflows for a whole portfolio view of risk across asset classes.”

Coinbase prime is the institutional prime broker arm of crypto exchange Coinbase, and it integrates prime financing, advanced agency trading, staking infrastructure, and reporting needed for the entire transaction lifecycle. Supporting more than 13,000 institutional clients, Coinbase Prime will render crypto trading, prime brokerage, reporting capabilities, and custody through the deal. 

As institutional crypto adoption continues to tick, the BlackRock-Coinbase partnership seeks to be a stepping stone toward developing new access points. 

A recent study by the leading investment bank Goldman Sachs showed that 51% of its institutional clients had crypto exposure.

The findings revealed that institutional interest in cryptocurrencies was witnessing strong growth because crypto exposure rose from 40% in 2021 to 51% in 2022, Blockchain.News reported.

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USDC Issuer Circle Secures $400M Funding from Fidelity and BlackRock

Circle, the company behind USD Coin (USDC), has bagged funding worth $400 million from different players, including Fidelity Management, BlackRock Inc, and Research LLC, signalling traditional finance interest in the crypto space.

As one of the largest tokens in terms of market capitalization, USDC has just surpassed Tether (USDT) by reaching a $40 billion market cap on the Ethereum network, according to online media Anue, citing data from CryptoRank data.

Currently, USDC’s presence in the crypto market continues to sit fifth among the top-ten cryptocurrencies, with a market capitalization over $50.68 billion, according to CoinMarketCap.

Circle’s partnership with BlackRock, a leading American multinational investment company, will enhance capital market applications for USDC. 

BlackRock will also be the primary asset manager for USDC’s cash reserves. 

The penetration of cryptocurrencies in traditional finance continues to gain steam. BlackRock’s CEO Larry Fink has shown receptiveness to this sector because he sees it as a stepping stone toward helping clients.

Rob Goldstein, the chief operating officer at BlackRock, acknowledged:

“We believe digital assets and blockchain technologies are going to become increasingly relevant for BlackRock and our clients.”

Circle’s CEO, Jeremy Allaire, noted that adding BlackRock as a strategic investor will boost USDC’s adoption. He pointed out:

“Dollar digital currencies like USDC are fueling a global economic transformation.”

Other investors in the project include Fin Capital and Marshall Wace LLP, with the funding round anticipated to end in the second quarter. 

Circle continues to make notable strides in the corporate world. Earlier this year, the Chicago-based company launched a new account service that enabled corporate customers to deposit, withdraw, receive and store cryptocurrencies through their account and settle all payments in USDC.

Furthermore, the newly added feature would enable corporate accounts to integrate cryptocurrency trading into their corporate accounts’ operations and offers eligible investors a stablecoin lending program called Circle Yield, Inc., which offers annual returns of up to 4% to 6%.

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BlackRock CEO Believes Russia-Ukraine War in Boosting Crypto Adoption

BlackRock Chairman and Chief Executive Officer Larry Fink has lent his voice to describe the role of digital currencies in the ongoing war between Russia and Ukraine.


In a letter to Shareholders on Thursday, Larry criticized Russia’s invasion of Ukraine, noting that it has set back about 30 years of globalization efforts.

Of particular note is the acknowledgement of the role of digital currencies which he noted will help many countries record a paradigm shift in their view and approach to the nascent asset class. An excerpt of Larry’s letter reads:

“A less discussed aspect of the war is its potential impact on accelerating digital currencies. The war will prompt countries to re-evaluate their currency dependencies. Even before the war, several governments were looking to play a more active role in digital currencies and define the regulatory frameworks under which they operate,” 

As correctly observed, digital currencies came to Ukraine’s aid when the country called for help with more than $30 million contributed by the broader community to support the country’s efforts in repelling Russian forces. From Bitcoin (BTC) to Dogecoin (DOGE), and Non-Fungible Tokens (NFT), the backing the crypto ecosystem gave to the Ukrainian people has not gone unnoticed.

Larry identified the move by many Central Banks to float a digital version of their currencies, a move that is poised to stem the dominance of cryptocurrencies in the emerging payment ecosystem. In Larry’s belief, crypto can help cut down the cost of transactions as well as in remittances. This obvious superior outlook has cemented BlackRock’s resolve to continually embrace digital currency innovations as it has done in time past.

“A global digital payment system, thoughtfully designed, can enhance the settlement of international transactions while reducing the risk of money laundering and corruption,” Larry said, concluding his talk on digital currencies, adding that “Digital currencies can also help bring down costs of cross-border payments, for example when expatriate workers send earnings back to their families.” 

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BlackRock expected to offer crypto trading as Three Arrows exec says long Bitcoin, ETH in 2022

Bitcoin (BTC) and Ether (ETH) are sure long bets for 2022, prominent investor and commenter Zhu Su says.

In a tweet on Feb. 10, Zhu, co-founder of hedge fund Three Arrows Capital (3AC), argued that BTC and ETH were the best options for investment this year, along with oil, while the S&P 500 is a no-go.

Zhu: 2022 macro trades “pretty clear”

Despite concerns that deflationary pressures could take Bitcoin and altcoins down with equities, not everyone believes that 2022 will be a red year for hodlers.

The picture is complex — some are eyeing a “melt-up” for stocks and crypto as a result, thanks to positive correlation. Others feel a painful period is due across the board, but that at least Bitcoin will emerge stronger thereafter.

Ex-BitMEX CEO Arthur Hayes, meanwhile, has been solidly gloomy on the macro outlook since the start of the year.

For Zhu, however, there are now “pretty clear” places to hedge cash for the coming three quarters.

An additional Twitter post agreed that adding Visa and MasterCard as fiat payment processors was also a “no brainer” for shorts.

“An insane 24 hours”

The forecast followed rumors that BlackRock, the world’s largest asset manager, is allegedly aiming to enter the cryptocurrency space.

Related: Price analysis 2/9: BTC, ETH, BNB, XRP, ADA, SOL, LUNA, AVAX, DOT, DOGE

According to several people with knowledge of the matter quoted by mainstream media, BlackRock clients could soon be able to trade crypto, while the giant will also facilitate credit in return for crypto collateral.

One source described BlackRock’s approach as “looking to get hands-on with outright crypto.”

The Canadian branch of Big Four accounting conglomerate KPMG announced it had added both Bitcoin and Ethereum to its balance sheet this week.

All in all, in the words of popular trader and analyst Pentoshi, adoption has fuelled an “insane 24 hours.”

As Cointelegraph reported, however, near-term BTC price gains remain far from a dead certainty for the bulls.