BlackRock Eyes Crypto and Blockchain Industry

UTC by Steve Muchoki · 3 min read
BlackRock Eyes Crypto and Blockchain Industry
Photo: Depositphotos

BlackRock and Circle have on top of the funding signed a strategic partnership to market the use of the USDC coin.

The world’s largest asset manager BlackRock Inc (NYSE: BLK), with approximately $10 trillion in AUM, is paying close attention to the crypto market. According to an update by Circle Internet Financial, the issuer of USD Coin (USDC), BlackRock is part of the investors in a $400 million fundraising.

Other notable investors include Fidelity Management, Marshall Wace LLP, and Fin Capital. The $400 million funding round is expected to close in the second quarter of 2022.

Worth noting, BlackRock and Circle have on top of the funding signed a strategic partnership to market the use of the USDC coin.

“In addition to its corporate strategic investment and role as a primary asset manager of USDC cash reserves, BlackRock has entered into a broader strategic partnership with Circle, which includes exploring capital market applications for USDC,” Circle noted in a press release.

BlackRock has huge roots inside the United States government through lobbyists and investors. Reports are that Steven Mnuchin has his wealth under BlackRock’s management. During the Trump administration, Mnuchin selected Craig Phillips, a former BlackRock employee to join the US treasury.

USDC is one of the fastest-growing dollar digital currencies with over $50 billion in circulation. Moreover, the demand for stablecoin is rising as global central banks look into CBDCs. It is to be remembered that CBDCs are to coexist with the Stablecoin market symbiotically.

“Dollar digital currencies like USDC are fueling a global economic transformation, and Circle’s technology infrastructure sits at the center of that change. This funding round will drive the next evolution of Circle’s growth,” said Jeremy Allaire, Co-Founder and CEO of Circle. “It’s particularly gratifying to add BlackRock as a strategic investor in the company. We look forward to developing our partnership.”

BlackRock and Crypto Market

As the world’s largest asset manager, its entrance into the crypto market is a great influence on other institutional investors. Over the past decades, BlackRock and other institutional investors have pivoted on Gold. However, a shift has taken place in the past decade and the crypto market is winning over.

Nonetheless, Gold is still leading with approximately $10 trillion in market capitalization. On the other hand, the crypto market has a total market cap of approximately $2 trillion. Arguably, the crypto market is expected to overtake Gold’s market value in the next decade.

Despite the Covid-19 crisis, the investment manager recorded notable cash inflows in the first quarter of 2022.

“BlackRock generated $114 billion of long-term net inflows in the first quarter, with positive flows across all product types, investment styles and regions, demonstrating the breadth of our asset management platform. Our ETFs delivered $56 billion of net inflows, as clients increasingly use them to efficiently allocate capital, access liquidity and manage risk. Active net inflows of $20 billion were led by LifePath target-date strategies and strong demand for alternatives,” said Laurence D. Fink, Chairman and CEO at BlackRock.

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