Activist investor Carl Icahn took a swing at the high-yield debt market and liquidity Wednesday, contending that BlackRock creates an "extremely dangerous situation" by encouraging debt issuance.



"They sell liquidity. There is no liquidity. That's what's going to blow this up," Icahn said while debating the merits of activist investing with BlackRock CEO Larry Fink at the Delivering Alpha conference presented by CNBC and Institutional Investor.



"I'm not blaming Larry personally. I'm blaming BlackRock," Icahn said to laughter from the conference attendees.

Read MoreIcahn, Fink square off on activism

While Icahn diverted to the conversation to a discussion on high-yield, much of the panel surrounded the merits of activism in corporate structuring. Activist investors "play an important role" but can act for short-term gains with little regard for future prospects in some instances, Fink said.