Spot Bitcoin Private Trust Comes on Heels of Coinbase Deal

Black­Rock has launched a spot bit­coin pri­vate trust open to insti­tu­tion­al inven­tions in the Unit­ed States, the world’s largest asset man­ag­er said in a release on its website.

Accord­ing to the announce­ment, the trust will track the per­for­mance of Bit­coin, despite the steep down­turn in the dig­i­tal asset mar­ket. The com­pa­ny said it was “see­ing sub­stan­tial inter­est from some insti­tu­tion­al clients in how to effi­cient­ly and cost-effec­tive­ly access these assets using our tech­nol­o­gy and prod­uct capabilities.”

“The launch of BlackRock’s Bit­coin fund is a sign of how far cryp­to has matured as an asset class,” said Sui Chung, CEO of cryp­to index provider CF Benchmarks.

The announce­ment also high­light­ed that Black­Rock has been focus­ing on four areas of dig­i­tal assets and asso­ci­at­ed ecosys­tems. These include per­mis­sioned blockchains, sta­ble­coins, cryp­to-assets, and tok­eniza­tion.

BlackRock partners with Coinbase

The move comes on the tail of Black­Rock announc­ing a part­ner­ship with Coin­base ear­li­er this week. The asset man­ag­er will con­nect its Aladdin invest­ment tech­nol­o­gy plat­form with the exchange, due to its com­pre­hen­sive trad­ing, cus­tody, prime bro­ker­age and report­ing capabilities. 

This will enable BlackRock’s insti­tu­tion­al clients to trade cryp­tocur­ren­cies, start­ing with Bit­coin. The Aladdin net­work is wide­ly used in fund man­age­ment to link asset man­agers, insur­ers and banks to mar­kets, who will also now be able to use it to man­age their Bit­coin exposures.

The move by the asset man­ag­er rep­re­sents a marked shift in its stance on dig­i­tal assets, espe­cial­ly from vocal cryp­to skep­tic Lar­ry Fink. BlackRock’s chief exec­u­tive said in 2017 that “Bit­coin just shows you how much demand for mon­ey laun­der­ing there is in the world,” adding “that’s all it is.”

Mean­while, Coin­base, the largest cryp­tocur­ren­cy exchange in the U.S. by vol­ume, booked a loss of more than $1.1 bil­lion for the sec­ond quarter. 

The pub­licly-list­ed exchange fell short of its tar­gets for the quar­ter as key met­rics plum­met­ed. Ear­li­er this week, it was sub­poe­naed by the Secu­ri­ties and Exchange Com­mis­sion (SEC) over its stak­ing and yield products.

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