Category Archives: BlackRock

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BlackRock Waiting for Market ”Legitimacy” to Launch Crypto ETF

The largest asset manager in the world, BlackRock, has said that any plans to launch a cryptocurrency exchange traded fund (ETF) will be put on hold until the market matures.

BlackRock CEO Larry Fink featured on CNBC Thursday, where he shared, “I wouldn’t say never, when it’s legitimate, yes.”

While a number of Bitcoin ETFs have been proposed to the Securities and Exchange Commission for its required approval, the agency has identified a number of issues that have prevented any being launched as of yet. Most notably included is a need to protect investors from activities such as insider trading that it believes the market is particularly susceptible to due to a lack of oversight.

It is this level of independence that the market operates with that Fink sees as a factor stifling its growth into mainstream finance.

“It will ultimately have to be backed by a government. I don’t sense that any government will allow that unless they have a sense of where that money’s going for tax evasion and all of these other issues,” he said, although due to the ideology behind Bitcoin‘s creation, it is very unlikely to become backed by the state.

While Fink was skeptical of the cryptocurrency’s apparent ease of use in illicit activities, he does see a future where a digital currency could be traded as a store of value, something that some investors say is Bitcoin’s primary use case. For now, however, he says that there is no need that he can see for a store of wealth unless it involves ”things you should not be doing”.

Blockchain is something that the CEO does have faith in though, describing BlackRock as a ”huge believer in blockchain”. He cites the most likely area for mass adoption as that which involves laborious paperwork such as mortgage applications and ownership.

 

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BlackRock CEO Denies Previous Reports of Crypto Foray

On 16 July 2018, a news story that BlackRock was creating a team to explore cryptocurrency investment was thought to have sparked a 5% Bitcoin rally. This news story was based on insider tips to Financial News London. Now the CEO of BlackRock, Larry Fink, has denied these reports.

Larry Fink said, “I don’t believe any client has sought out crypto exposure. I’ve not heard from one client who says I need to be in this.”

BlackRock did not rule out moving into the cryptocurrency space once regulations mature. Fink told Bloomberg, “When it becomes more legitimatized, when it has a true open nature of it that you can identify who the players are on both sides, that’s when we’ll probably look at it.”

Simultaneously, Fink indicated that he was very excited about blockchain technology itself. Blockchain technology can be used to improve the infrastructure of an organization like BlackRock by providing an immutable cryptographically secure database, and it can also be used as the backbone for instant and cryptographically secure transactions. Blockchain technology is being used by many organizations around the world to increase efficiency and trustworthiness, and doesn’t require implementing or using cryptocurrency itself.

Despite the revelation that BlackRock will not be investing in crypto anytime soon, Bicoin held its gains and currently sits at USD 6,700.

 

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$6 Trillion Asset Manager BlackRock Explores Crypto Potential

Asset managing giant BlackRock is rumored to be considering moves into cryptocurrency, writes Cryptoglobe.

Citing a report in the Financial News, the company, which is the world’s largest asset manager with assets under management of over USD 6.3 trillion as of November 2017, is said to be putting together a team of experts in the field to investigate blockchain and cryptocurrencies.

If the reports are correct, then this would represent a huge turnaround since cryptocurrencies where disparagingly rejected by the company just earlier this year. The following comment was made by BlackRock in February:

“We see cryptocurrencies potentially becoming more widely used in the future as the markets mature. Yet for now, we believe they should only be considered by those who can stomach potentially complete losses.”

Although the comment could imply that it saw at that point that potential wasn’t readily available in view of the crypto markets’ immaturity, it is undeniable that after CEO Larry Fink’s comments that Bitcoin was simply “an index of money laundering” that the company had little respect for the nascent industry earlier this year.

Although at this stage it’s unclear what exactly has changed at executive level, the company has made announcements which point to a significant change in attitude towards the industry. To quote the London-based Financial News, BlackRock “has created a team from different parts of the business to investigate cryptocurrencies and their underlying infrastructure, blockchain”.

The report also suggests that the working group will consider if the company should invest in Bitcoin futures and plans to examine what its competitors are also doing in the crypto business as regards the impact that this may have on BlackRock itself.

BlackRock is a hugely successful company and any move into the cryptocurrency arena is sure to have ramifications. The Financial Times reported that the company increased its new business revenue by 76% in 2017 with expectations the company’s global assets could double by 2022. The company currently employs 13,000 in 30 countries.

 

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Wall St Millennials Crack Crypto Fortunes: Banker Starts New Life Firewalking

Millennials are leaving behind the world of private equity and hedge funds, and jumping off the Wall Street merry-go-round for a new life because they’ve already made their money on cryptocurrency, writes EFC.

At least three staff members at New York’s Goldman Sachs have reported that it was time to move and start a new life, having made their own crypto fortunes, reports Bloomberg. Both Johnathan Cheesman, 36, and Justin Saslaw, a sprightly 28, have quit having made their money on trading and taking advantages of the crypto markets’ fluctuating fortunes.

Senior banker Jamie Dimon, who now regrets calling Bitcoin a fraud, is now forced to watch as those lower down the pecking order make enough money from cryptocurrency dealing to leave the security of a day job for pastures new. In March, Adrian Xinli Zhang became a director at Deutsche Bank in New York aged just 29, but was gone in a month after trading Bitcoin in his spare time, sources told Bloomberg.

BlackRock staff member Asim Ahmad put everything into Ether when he had the chance, using all of his life savings to invest in the digital currency, but has now left his London office to start anew on the back of his crypto profits. Asim commented:

“I’m in a position where it doesn’t make sense to work at BlackRock anymore… The one-day volatility of my portfolio is higher than my salary, so if I get a few investments right then I’ll have made the same as my yearly wage and everything else on top is a bonus.”

Zhang is reportedly working on a trading platform for digital assets, while Ahmad helps manage a fund that invests in blockchain businesses.

Why then, are millennials reaching these dizzy heights? Adam Grimsley, co-founder of crypto hedge fund Prime Factor Capital, suggests why a crypto generation gap among finance professionals certainly appears to be opening up.

“The youngsters may have less intellectual baggage and may be more open-minded, but they also have less responsibility for managing risk and working out the practicalities of bolting on crypto to the existing business.”

Grimsley adds, “You’ve seen a bifurcation internally at many larger houses where senior managers are very skeptical about crypto, while graduates and younger team members are very positive.”

Not all stay within the boundaries of the space that made them their fortunes. After more than 20 years working at HSBC and as a CEO for a while, Julius Cardoza now runs a London life coaching firm, with HSBC now one of his clients. One of his training program exercises is to get his clients to perilously walk over hot coals.

“Firewalking is transformational for the rest of your life because after that there’s nothing you’re frightened of because you have already tested yourself to the limits of what you think you can achieve,” he explains.

 

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