BlackRock’s entry into the crypto space has sent shockwaves through major cryptocurrencies like bitcoin and ethereum, igniting a rally in the broader market.
Following the filing of BlackRock’s exchange-traded fund (ETF), the bitcoin price surged, leading to a positive momentum for ethereum, BNB, XRP, cardano, dogecoin, tron, solana, and polygon. This surge occurred amidst a flurry of optimistic predictions for crypto prices, suggesting rapid advancements.
Growing Institutional Interest in Crypto
The growing interest from BlackRock, with nearly $10 trillion in assets under management has paved the way for potential investments in the bitcoin and crypto market.
A survey conducted by Laser Digital, the digital assets subsidiary of renowned banking giant Nomura, uncovered that 96% of professional investors, overseeing approximately $5 trillion, are eager to explore crypto investments.
According to Laser Digital CEO Jez Mohideen, the study demonstrates that institutional investors recognize the role of digital assets in portfolio diversification and the benefits they offer in investment management.
In addition, the survey encompassed 303 professional investors, collectively managing assets worth $4.95 trillion. Results showed that 82% of respondents expressed a positive outlook on bitcoin and ethereum. 88% considered crypto investments for themselves or their clients.
However, this strong inclination towards crypto among professional investors highlights a significant shift in the perception of digital assets within the investment landscape.
BlackRock Bitcoin ETF and Market Implications
BlackRock has made a move for a spot bitcoin ETF by filing a request for approval with the U.S. Securities and Exchange Commission (SEC), selecting Coinbase as its custodial partner.
Further, BlackRock’s involvement has injected fresh enthusiasm into the crypto industry, which had recently faced regulatory scrutiny and a significant price crash.
However, the CEO of bitcoin rewards app Lolli, Alex Adelman, noted that BlackRock’s actions indicate a growing demand for bitcoin exposure among its institutional clients, including some of the world’s largest institutions.
Adelman predicts that other Wall Street leaders will swiftly follow suit, leading to a wave of institutional bitcoin-related financial products. Moreover, this influx of institutional investments could shape the future trajectory of the crypto market, bringing new liquidity and opportunities.
Unlocking Liquidity with BlackRock Global Capital
However, concerns have been raised regarding whether BlackRock’s proposed bitcoin ETF will generate enough demand to significantly impact the market.
Further, Simon Peters, a market analyst at eToro, emphasized that the potential market influence remains uncertain.
BlackRock’s vast management of global capital could unlock substantial liquidity for bitcoin. He acknowledged that the spot ETF’s success comes with certain conditions, such as the sharing of surveillance data to prevent market manipulation.
Nevertheless, this requirement may clash with the decentralized nature of bitcoin, but it could be necessary to bring such a product to market.
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