Asset Management Giant BlackRock Is Now Exploring Cryptocurrencies

BlackRock - The world’s largest asset management company valued at $6.3 trillion is now exploring the cryptocurrency market along with its underlying blockchain technology, reports Financial News .

The company will also be studying regarding how its competitors are investing into different cryptocurrency vehicles like the Bitcoin futures as well as other institutional products. According to the Global Weekly Commentary published on Monday, July 16, BlackRock’s global chief investment strategist Richard Turnill expressed some positive views on the cryptocurrency market.

Trunill said: "We see cryptocurrencies potentially becoming more widely used in the future as the market matures. Yet for now we believe they should only be considered by those who can stomach potentially complete losses. Similarly, blockchain needs to overcome significant hurdles to reach its promising future.”

Trunill also wrote about how the cryptocurrency market is very volatile, unregulated and risky for it to be integrated in the mainstream investment portfolios at this moment. He said: “The volatility of the cryptocurrencies makes the gyrations in the U.S. equity market during the global financial crisis almost look placid.”

While discussing on the blockchain technology, Turnill expressed optimism on blockchain having “disruptive potential” for industries "from logistics and pharmaceuticals to financial service.” While taking the example of the financial industry, he explained: "a blockchain-based, single shared financial database could eliminate inefficiencies and risks associated with human processes, but adoption at scale would require a massive shift in software development and a well-constructed maintenance model."

But he also added that the blockchain space is very much in its nascent stage and also needs involvement of regulatory authorities and central banking institutions. The recent comments coming from BlackRock are certainly taking some interesting turn of events.

In an earlier interview to Bloomberg, BlackRock CEO Larry Fink called bitcoin as the “index of money laundering” but however, he praised the blockchain technology saying that it will “transform how we do our business.”

Following the yesterday’s reports, Fink again confirmed his views to Reuters in a short interview saying “We are a big student of blockchain,” Fink said, stressing that he doesn’t see “huge demand for cryptocurrencies”.

In the last few months, there have been multiple reports about big institutional giants planning to enter the cryptocurrency space. A number of institutional companies have also filed for Bitcoin-based exchange-traded-funds (ETFs) with the SEC.

Early this month, the Chicago Board Options Exchange (CBOE) filed for Bitcoin ETFs through VanEck SolidX Bitcoin Trust. The filing has been submitted to the SEC for approval and as per the proposal the Trust will invest only in Bitcoins also allowing its investors to make over-the-counter (OTC) purchases.