The world’s largest asset manager, BlackRock, has finally decided to dabble into Bitcoin. Confirming the latest development, BlackRock’s managing director Rick Rieder told CNBC’s Squawk Box that his firm was looking into Bitcoin.
Although Rieder refused to name the target allocation BlackRock has, he said:
We've started to dabble a bit in it[...]My sense is the technology has evolved and regulations have evolved to the point where a number of people feel it should be part of the portfolio.
The $8.7 trillion asset manager has joined the herd of institutional Bitcoin believers. Rieder claims that exposing the firm’s portfolio to cryptocurrencies “makes some sense” since traditional hedges no longer work.
We’re holding a lot more cash than we’ve held historically because interest rates don’t work as a hedge and diversifying in other assets makes some sense. So, holding some portion of what you hold in cash and things like crypto seems to make some sense to me.
The signs were already there. As reported by BTC PEERS, BlackRock left cues to its inevitable entry to the Bitcoin space through a SEC filing on January 20. The firm sought to include cash-settled Bitcoin futures as investment options for two of its funds. Before this, BlackRock’s executives have made comments signaling that they were actively evaluating Bitcoin.
With $8.7 trillion on the sidelines, Grayscale could easily be displaced as the world's largest crypto asset manager.