The worldâ€™s largest asset manager with almost $9 trillion in assets under management, Blackrock, has started investing in bitcoin. Sharing his view on whatâ€™s driving up the price of the cryptocurrency, the firmâ€™s chief investment officer says the technology and the regulation have evolved to where people find bitcoin should be part of their portfolios. In addition, people are looking for investments that could appreciate as inflation and debts move higher.
Blackrock Has Entered the Bitcoin Space
Blackrockâ€™s chief investment officer of global fixed income, Rick Rieder, talked about bitcoin in an interview with CNBC on Wednesday. The New York-based asset management firm had $8.68 trillion of assets under management at the end of the fourth quarter.
Rieder confirmed that Blackrock has â€œstarted to dabbleâ€ in bitcoin. When asked about what portfolio allocation should be in the cryptocurrency, he replied: â€œI wouldnâ€™t put a number on the percentage allocation one should have, [since it] depends on what the rest of your portfolio looks like.â€ The Blackrock chief investment officer explained:
In January filings with the U.S. Securities and Exchange Commission (SEC), Blackrock disclosed its plans to add bitcoin futures to two of its funds: the Blackrock Strategic Income Opportunities and the Blackrock Global Allocation Fund.
Bitcoin has been rapidly gaining popularity among institutional investors. More companies are embracing the cryptocurrency, including Elon Muskâ€™s Tesla, which has invested $1.5 billion in bitcoin and will soon accept the cryptocurrency as payment for its products. Last week, Mastercard announced that it will allow certain cryptocurrencies directly on its network and BNY Mellon unveiled a crypto unit to provide clients with bitcoin services.
Commenting on the spectacular rise in the price of bitcoin, the Blackrock chief investment officer, who previously said that cryptocurrency is here to stay and could replace gold, opined:
The price of bitcoin hit an all-time high again Friday, pushing its market capitalization above $1 trillion. At the time of writing, the BTC price stands at $53,720.
The chief investment officer of the worldâ€™s largest asset management firm further detailed: â€œWeâ€™re holding a lot more cash than weâ€™ve held historically. Itâ€™s because duration doesnâ€™t work, interest rates donâ€™t work as a hedge.â€ Noting that he â€œwouldnâ€™t espouse a certain allocation or target holding,â€ Rieder concluded:
What do you think about Blackrock entering the bitcoin space? Let us know in the comments section below.
Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.