BlackRock, the world's largest investment fund manager, has added the Bitcoin cryptocurrency as an eligible investment to its Global Allocation Fund, one of the investment vehicles preferred by its clients and investors.
The growing interest of investors in Bitcoin and cryptocurrencies has allowed these digital assets to continue making inroads on Wall Street.
With companies like MicroStrategy, Block (formerly Square Inc), Stone Ridge, Goldman Sachs and several others Investing in Bitcoin directly, The popularity of cryptocurrency has been increasing and with it, the confidence of investors.
Recently, it became known that the world's largest investment fund manager, BlackRock, which managed around $10 trillion in assets under management as of early 2022, has added Bitcoin to one of its flagship funds, the Global Allocation Fund.
According to Finance Feeds, this $15.000 billion investment fund is dedicated to investing in stocks, securities and debt bonds and will be able to allocate part of its funds to cash-settled Bitcoin futures traded through exchanges registered with the United States Commodity Futures Trading Commission (CFTC).
BlackRock could buy BTC from exchanges with 0,32% of its global allocation fund
According to experts' estimates, just 0,32% of BackRock's Global Allocation Fund would be enough to buy all the BTC that is available on exchanges, which is around 1.856.625 BTC.
This amount of bitcoins is valued at approximately $32.100 billion today, based on the current BTC market price of $17.300 per unit.
The addition of Bitcoin to this major global investment fund could accelerate institutional entry into the crypto market, sending millions of dollars into the oldest and most liquid cryptocurrency on the market in the coming months. Through the Global Allocation Fund, BlackRock is making it even easier for its investors to gain exposure to Bitcoin.
Optimism about the future of Bitcoin
BlackRock is one of the major financial players in the traditional industry that is leading the charge for Bitcoin, despite the drastic fall that the crypto market experienced in 2022.
In the second half of the year, BlackRock opens the doors to direct investment in Bitcoin, allowing its investors to invest and gain exposure to cryptocurrency in the spot market through a private crypto investment fund.
As reported by this media, BlackRock investors have been demanding greater exposure to the main cryptocurrencies on the market, in order to diversify their portfolios and unlock the financial opportunities offered by blockchain and Web3 technologies.
Growing demand from its investors for the crypto sector also prompted the New York City-based financial giant to launch new services for the custody and trading of bitcoins.
In August, BlackRock notified its clients that its new cryptocurrency services were available to its institutional investors through its Aladdin trading and investor management platform.
Its CEO, Larry Fink, maintains a fairly optimistic view on the future of Bitcoin as an investment asset. “I think there is a very important role for a digital currency (Bitcoin), and I think that is going to help consumers around the world”, Fink said during an interview with CNBC in 2021.
Participation in Core Scientific
BlackRock is also a shareholder in one of the largest crypto mining companies, Core Scientific, to which it granted a $17 million loan in late December after the Bitcoin mining company filed for bankruptcy protection.
According to the filing, BlackRock held $37,9 million in Core Scientific's secured convertible notes as of Dec. 28. The New York-based investment management company is currently one of the crypto mining company's largest creditors.
BlackRock has also participated in a funding round of Circle, the company developing the USDC stablecoin, and has partnered with Coinbase to expand its investors' exposure to the crypto world.
Continue reading: BlackRock adopts Bitcoin to offer new services to its institutional clients
