BlackRock – the world’s largest asset manager, overseeing a total of more than $10 trillion worth of assets – has launched a new private spot Bitcoin (BTC) trust.
The spot Bitcoin trust is only available to institutional investors in the US and seeks to track the performance of Bitcoin, minus the costs and liabilities of the trust.
Explaining the decision, BlackRock said:
“DESPITE THE SHARP DOWNTURN IN THE DIGITAL ASSET MARKET, WE CONTINUE TO SEE SIGNIFICANT INTEREST FROM SOME INSTITUTIONAL CLIENTS IN EFFICIENTLY AND COST-EFFECTIVELY ACCESSING THESE ASSETS USING THE CAPABILITIES OF OUR TECHNOLOGY AND PRODUCTS. BITCOIN IS THE OLDEST, LARGEST AND MOST LIQUID DIGITAL ASSET AND IS CURRENTLY THE PRIMARY FOCUS OF INTEREST FOR OUR CLIENTS IN THE DIGITAL ASSET SPACE.”
No need to register with regulators
Private investment trusts that do not solicit investments from retail investors do not need to register with United States regulators. But some others, such as the Grayscale Bitcoin Trust, can still trade – although they are not registered with the SEC – in the OTC markets.
Excluding stablecoin, Bitcoin retains close to 50% of the industry’s market capitalization.
The use of energy
In terms of the blockchain’s energy use, BlackRock said it is encouraged by organizations such as RMI and Energy Web, which are developing programs to offer greater transparency into sustainable energy use in Bitcoin mining.
Blackrock’s relationship with cryptocurrencies
Last week, BlackRock announced a partnership with cryptocurrency exchange Coinbase to provide customers with instant ratings on cryptocurrencies, starting with Bitcoin.
Users of BlackRock’s institutional investment management platform, Aladdin, will have cryptocurrency trading, custody, basic brokerage and reporting capabilities upon enrollment in Coinbase Prime.
On a broader level, BlackRock said it conducted research into four areas of digital assets – permissioned blockchains, stable currencies, cryptocurrency assets and tokenization – and their associated ecosystems.
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