Wall Street Celebrities Lurking in the Crypto Market: BlackRock Crypto Landscape Begins to Emerge
BlackRock, the Biden administration’s “shadow cabinet,” has been involved in a number of areas, including bitcoin trading and mining.
By: Blikclike Editorial Office
A recent set of figures from Pitchbook shows that venture capital funds have invested $17 billion in companies in the crypto space in the first six months of the year. This amount of money represents the most money raised in a single year in history, and is almost equal to the total amount of money raised in previous years combined.
Blocklike has observed that since last year, the strong interest in crypto by major mainstream financial institutions has materialized into one complete crypto market layout after another.
Since the Biden administration announced its new cabinet economic team, this team has been labeled as “BlackRock influx, Goldman Sachs fade out” by the media, and in this context, the actions of BlackRock, the largest publicly traded investment management group in the United States, have attracted much attention.
In fact, BlackRock’s shadow can be seen behind Bitcoin, MicroStrategy, and North American mining companies, and the crypto map of Wall Street’s head “celebrity” BlackRock has already been revealed.
The Crypto Landscape of Wall Street’s Mainstream
The change in BlackRock’s attitude towards digital assets may be very influential.
In late 2017, BlackRock CEO Larry Fink also had a negative attitude toward bitcoin, but it eased in 2018 when BlackRock quickly set up a working group to study bitcoin futures.
BlackRock’s view on the crypto market has changed during this upward stretch of the market from the middle of last year to the present.
In late November of last year, BlackRock’s Chief Investment Officer of Fixed Income publicly signaled that “Bitcoin will be able to replace gold. Later in the year, the head of BlackRock made a rare positive statement about bitcoin, suggesting that it could evolve into a global market asset. Previously, large mainstream institutions have been more cautious about responding positively to digital assets. But with bitcoin’s good hedging performance in the context of the epidemic last year, mainstream Wall Street institutions are changing their views on the asset class.
According to BlackRock’s most recent official earnings release, its asset under management (AUM) has reached $9.01 trillion, a size of money under management that exceeds the GDP of a large percentage of countries.
In January of this year, BlackRock approved two of its funds to trade bitcoin futures.
During the same period, a BlackRock filing with the SEC was the first to disclose BlackRock’s early holdings of $6.5 million in bitcoin futures on the Chicago Mercantile Exchange (CME) (the contracts expire on March 26, 2021). Based on prices at the time, they invested a total of the equivalent of 185 bitcoins, as each contract was equivalent to 5 BTC. Based on further calculations, the average price of this investment is around $35,000 per bitcoin. This is one of the more positive signals from traditional financial institutions.
The market has theorized that this round of institutional investment took place between late January and early February 2021, roughly the same time as Tesla’s $1.5 billion bitcoin buying spree.
BlackRock quickly acknowledged its involvement in Bitcoin with an announcement in mid-February. They believe that “the technology, the regulations have evolved to the point where many people think it can be an acceptable part of the portfolio.
During the same time period, news of Tesla’s increased Bitcoin holdings led directly to the total Bitcoin market cap surpassing the $1 trillion mark. During this timeframe, institutions such as BlackRock, JP Morgan, Goldman Sachs, Morgan Stanley, Sequoia and others “made their cards clear,” demonstrating the collective movement of mainstream investment institutions into bitcoin.
This is just one of the ‘signals’ from BlackRock that this ‘involvement’ is multi-faceted in the crypto market.
BlackRock, the largest shareholder of the highly topical “bitcoin long” MicroStrategy, holds 14.79% of the company’s shares. The company’s largest stakeholder is BlackRock, which holds 14.79% of MicroStrategy’s shares.
MicroStrategy has become a de facto bitcoin ETF, as it has become a sort of indirect access platform for BlackRock and other shareholders.
According to publicly available information, MicroStrategy’s total bitcoin holdings are now over 100,000. This means that its “bitcoin value” content is quite high relative to its stock market capitalization. MSTR stock has become a highly correlated stock with Bitcoin that is more readily available to institutional and general investors than the GBTC purchased by traditional institutions, and the choice of MicroStrategy stock has been able to demonstrate the attitudes and preferences of investment institutions at a time when the approval of a U.S. Bitcoin ETF has been repeatedly delayed.
The same approach to the crypto market through shares of publicly traded companies has been used by BlackRock to get involved in the bitcoin mining industry.
Crypto market analyst Tyler Swope has publicly commented that BlackRock is already deeply involved in the Bitcoin mining industry, and that it is well aligned with the company’s future direction. BlackRock has now taken a partial stake in Marathon Digital Holdings, a leading bitcoin miner in North America, and may represent a long term move for the investment house into digital currency mining.
Marathon has a long term view on the future development of BTC and holds BTC as an asset for the long term.
Marathon Digital Holdings Institutional Investors
Interestingly, the end of May saw a sudden increase in discussions about Bitcoin and ‘renewable energy’, followed by the formation of the ‘Bitcoin Mining Council’, a coalition of digital currency miners and public companies from across the US, including members of MicroStrategy, Marathon Digital, Riot, Galaxy Digital Hut 8, Hive, Core Scientific, Blockcap and Argo, among other members. The consortium is committed to improving transparency in energy use and accelerating global sustainability initiatives.
With MicroStrategy and Marathon Digital as key participants in the coalition, BlackRock already has a voice in the conversation around sustainable bitcoin mining.
BlackRock: The Biden Administration’s Shadow Cabinet
Some analysts believe that the crypto market’s recent “renewable energy” direction is consistent with BlackRock’s next investment direction.
In fact, the “Goldman Sachs administration” that was once spoken of by many bankers in the U.S. has shifted, and the BlackRock Group has generally been said to have more influence in the Biden cabinet since the Biden administration took office. A number of BlackRock executives, including Brian Deese, senior investment advisor Wally Adeyemo and others in the Sustainable Investment Group, hold key positions in the Biden administration, a role that the foreign press believes is “sufficient” to influence U.S. economic policy.
Early in his campaign, Biden made a number of environmental and clean energy proposals, promising “to achieve ‘zero emissions’ in the U.S. electricity sector by 2035 and to make the country carbon neutral by 2050. Among his plans for American jobs is a push to move the U.S. transportation system to electric power and to implement new clean energy standards.
In late April, Biden formally announced a $2.5 trillion corporate tax increase. The plan is also known as the “infrastructure plan. But conservatives have commented that most of the plan’s spending will go to Democrats’ preferred social welfare, new energy and racial equality programs. Significantly, the plan also eliminates subsidies to the fossil fuel industry. As taxes on oil and gas production increase, subsidies for clean energy will also increase significantly. The plan is said to be highly favorable in the direction of clean energy and renewable technology.
In this direction, BlackRock’s approval is quite high. In the first quarter of this year, BlackRock increased its stake in Blink Charging Co (BLNK), the largest operator of electric vehicle charging services in the United States. Analysts from the community believe that this is consistent with BlackRock’s underlying logic in focusing on Marathon Digital stock.
Overall, as of last month, on Wall Street this year, stocks such as Goldman Sachs (GS), JPMorgan Chase (JPM), Bank of America (BAC), Morgan Stanley (MS), Citigroup and others have seen declines ranging from 20% to 45%, with market capitalization generally declining, while BlackRock, which has maintained modest gains, has emerged as the new financial market focus. BlackRock’s multifaceted approach to the crypto market may bring about a potential shift in the overall market.
On the positive side, the mainstream institutions represented by BlackRock are entering the crypto market, a trend that is certainly bringing more credibility and market acceptance to bitcoin as a new asset class. With its intricate backdrop of new opportunities and risks being injected into the existing financial system by many Wall Street giants, bitcoin trading may continue to trend towards specialization and more market liquidity.
Posted by:CoinYuppie，Reprinted with attribution to:https://coinyuppie.com/wall-street-celebrities-lurking-in-the-crypto-market-blackrock-crypto-landscape-begins-to-emerge/
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