In a Fox Business interview, Larry Fink, CEO of BlackRock, the largest asset manager in the world, compared Bitcoin to gold and asserted that it is “digitizing” gold.
Larry Fink, the CEO of BlackRock, has expressed enthusiasm for digital currencies like Bitcoin, as the fund’s manager reapplies to list a Bitcoin exchange-traded fund (ETF) in the US. Fink made these comments in a press conference on July 5; he also asked American regulators to take into account the possible democratization of banking and finance through the creation of a Bitcoin-linked ETF.
The price of Bitcoin has increased by an astonishing 83% since the year 2023 began. Given that a sizable amount of the gains occurred after BlackRock submitted an application for a spot Bitcoin Trust ETF in mid-June, this move is very noteworthy. The company’s proposal is one of many from titans of the sector, including Ark, InStress Eco, VanEck, and Greyscale, who are all looking for regulatory approval for comparable crypto goods.
Fink stressed the independence of Bitcoin, calling it an “international asset,” which makes it a desirable alternative for investors. He said Bitcoin might act as a hedge against currency devaluations or inflation. Fink’s support of cryptocurrencies as CEO of BlackRock, the largest asset management company in the world with more than $9 trillion in assets under management, could have a big impact on the sector.
On social media, cryptocurrency fans reacted favorably to Fink’s comments. Some speculated that they may cause an increase in asset prices that they called the “Fink Pump.”
BlackRock has been actively pushing the introduction of a spot Bitcoin ETF, teaming up as a surveillance partner with cryptocurrency exchange Coinbase. The Securities and Exchange Commission (SEC), which has previously rejected all spot Bitcoin ETF applications, has not yet indicated whether it will accept an investment vehicle.
Fink’s views carry weight because he is the CEO of a well-known financial institution, which could have an impact on both market participants and regulators. Traditional financial institutions’ increased interest in cryptocurrencies is evidence of the industry’s transformation and growing recognition of the possibilities of digital assets.
The CEO of BlackRock explained how lowering the pricey bid-ask spread for cryptocurrencies would lower transaction costs and increase investment returns. Fink sees this crypto democratization as a step in the direction of greater financial inclusion.
Due to the early usage of cryptocurrencies for illegal purposes, Fink first expressed some skepticism about them. He has since changed his mind, realizing the importance of Bitcoin as an international asset unattached to any particular currency and as a hedge against inflation.
Fink believes that the underlying blockchain technology has the potential to improve transaction speed and traceability, effectively eliminating some conventional financial intermediaries, notwithstanding the skepticism surrounding its usefulness. Despite this, he acknowledges that the world is “not close” to being in this position just yet, indicating that there is still much possibility for advancement.