Earlier this week, international asset management firm BlackRock Inc. indicated a shift in their stance on digital currencies and bitcoin (BTC) futures. THe U.S.-based firm, which houses the 10th-largest hedge fund in the world, highlighted a change in the views of CEO Larry Fink, according to Crypto Daily.
Fink, who previously believed that digital currencies like BTC were simply speculative and best left as an asset for criminals and those interest in money laundering, has since appeared to have left the door open to the possibility that his company might get involved in the space. Below, we’ll explore what this news from BlackRock might mean for other mainstream financial institutions, and why the company’s new ideas have some analysts predicting a bull run by institutional investors.
A BlackRock spokesman indicated that the company has a “working group that meets periodically to exchange information on blockchain and consists of employees from various parts of the business.” Recently, the company said it has been “recognizing potential for shared processes and data across market participants, clearing, settlement and reconciliation and simplified securities issuance.”
BlackRock Could Pave the Way
Considering that BlackRock is one of the largest asset management firms in the world, they may be in a perfect position to inspire other institutional investors to become interested in the digital currency space as well. If nothing else, BlackRock would be a major company with a huge amount of money to invest in the space. Even if other similar firms don’t follow in their footsteps, this alone could sway the price of many digital currencies and inspire renewed confidence at a time in which the market in general has sagged.
Perhaps more exciting for the cryptocurrency enthusiast, though, is the possibility that BlackRock will be one of a growing number of institutional investors to begin to explore the digital currency world. The thinking goes, if a major firm like BlackRock believes there is real potential in the space, why shouldn’t other outfits as well? Particularly if BlackRock sees success with any future ventures into bitcoin or other cryptocurrencies, the market could shift dramatically and quickly as well.
Investing in cryptocurrencies and Initial Coin Offerings (“ICOs”) is highly risky and speculative, and this article is not a recommendation by Investopedia or the writer to invest in cryptocurrencies or ICOs. Since each individual’s situation is unique, a qualified professional should always be consulted before making any financial decisions. Investopedia makes no representations or warranties as to the accuracy or timeliness of the information contained herein. As of the date this article was written, the author owns bitcoin and ripple.
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