World’s largest asset manager BlackRock plans to start offering crypto trading services

  • Apart from crypto trading, BlackRock is reportedly planning to bring credit loan facilities with crypto as collateral.
  • BlackRock has been seeking exposure to Bitcoin and crypto mining firms over the last year.

Every big financial giant in the market is willing to play the crypto game, be it traditional players like banks or big financial institutions. The latest news is that the world’s largest asset manager BlackRock is looking to provide crypto trading services to its clients.

BlackRock is currently managing more than $10 trillion in assets under management. Thus, it holds a strong potential to give a massive liquidity push to the crypto market. People familiar with the matter said that BlackRock plans to enter the crypto space with “client support trading and then with their own credit facility”. Meaning clients will be able to borrow from the asset manager by putting their own digital assets as collateral.

Citing another person familiar with the matter, CoinDesk reported:

BlackRock will allow its clients – which include public pension schemes, endowments and sovereign wealth funds – to trade cryptocurrency through Aladdin (short for “Asset, Liability, Debt and Derivative Investment Network”), the asset manager’s integrated investment management platform. The timetable for unveiling the service is unclear.

BlackRock is not the first financial giant to venture into the crypto trading business. Some of the top Wall Street banks and financial institutions like Citi, Morgan Stanley, and Goldman Sachs are making careful moves in this segment. However, BlackRock has yet to make any official comment in this regard.

BlackRock and its crypto journey

Over the last year, BlackRock has given multiple positive signals on its plans for crypto. As per its filing with the U.S. Securities and Exchange Commission (SEC), BlackRock trades CME futures.

In February last year, BlackRock CIO Rick Reider stated that the company has started dabbling into Bitcoin. Reider also said that there is an increase in the demand for high-yield assets. He also added that with a possible uptick in inflation, investors will seek exposure to hedge assets like Bitcoin.

The asset management giant is further planning to launch the iShares Blockchain and Tech ETF. This exchange-traded fund will track an index comprising of companies involved in “development, innovation, and utilization of blockchain and crypto technologies,” in the U.S. and abroad.

Additionally, BlackRock holds a significant stake in Bitcoin with investments totaling $384 million. BlackRock holds over 6 percent in two public-listed crypto mining firms. This includes names like Marathon Digital and Riot Blockchain.

Not to forget that BlackRock has a staggering 15 percent stake in the world’s largest corporate Bitcoin holder, MicroStrategy. As of date, MicroStrategy holds more than 125,000 BTC on its balance sheet. Well, this makes it clear that BlackRock has its wings widespread in the crypto space. Also, most of the exposure is directly or indirectly in Bitcoin.

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