Blackrock Embraces Bitcoin – Investment Giant Makes a Power Play

Investing in Bitcoin Futures, ETFs, and Collaborating with Coinbase and Circle

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BlackRock, the world’s largest asset manager, is adding Bitcoin as an investment option to its flagship fund, the “Global Allocation Fund“, which is one of the most preferred “vehicles” for retail and passive investors.

A report from the firm indicates that the move allows BlackRock to allocate a portion of the fund’s $15 billion in Bitcoin futures.

About “Global Allocation Fund”

The “Global Allocation Fund” adopts a fully managed investment policy that utilizes U.S. and foreign equities, debt securities and money markets, the combination of which varies from time to time depending on economic trends.

Under normal market conditions, the primary fund invests at least 70% of its total assets in securities of corporate and government issuers. Based on its past performance, it has delivered a 5-year annual total return of 10.35% and ranks in the top three among peers in its class.

“The fund may invest, with cash settlement, in Bitcoin futures contracts traded on commodity exchanges that are registered with the Commodity Futures Trading Commission,” the company’s report said.

blackrock's larry fink
– BlackRock’s Larry Fink

Turned to Bitcoin

BlackRock made headlines last year when it added Bitcoin futures to its derivatives products, in which two of its funds can invest.

The development came shortly after BlackRock’s CEO Larry Fink spoke positively about Bitcoin, saying it has “captured attention” and could largely replace gold. However, he had warned of its growing popularity having a real impact on the US dollar.

However, Fink’s above stance was a 180-degree turn for him, as he had previously described Bitcoin as nothing more than a vehicle for speculation and money laundering.

And ETFs on the Blockchain

The world’s largest asset manager, BlackRock, launched a blockchain-focused ETF last April, which provides investors with exposure to the cryptocurrency and blockchain industry. The company added the “Blockchain and Tech ETF (IBLC)” to its iShares product line.

Collaboration with Coinbase

BlackRock had signed a partnership agreement with the main brokerage arm of the popular US stock exchange, Coinbase. However, the partnership is limited to Bitcoin and will allow BlackRock’s institutional clients to access cryptocurrency trading, custody, prime brokerage and reporting through Coinbase Prime.

Clients can also manage their Bitcoin and conduct risk analysis using BlackRock’s software suite, Aladdin.

Collaboration with Circle

BlackRock also participated in a $400 million funding round for Boston-based fintech startup, Circle.

In addition to its investment and its role as lead asset manager of USDC cash reserves, BlackRock entered into a partnership with Circle to explore capital market applications for its stablecoin.

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