BlackRock CEO’s change over Bitcoin, causing welcome and skepticism | CoinDesk JAPAN | CoinDesk Japan

Larry Fink, CEO of the world’s largest asset manager BlackRock, said yesterday that cryptocurrencies could “revolutionize finance”, previously skeptical. supported the crypto-asset industry.

Differs from the original ideal of digital assets

Fink’s shift in perspective may also make it easier for industry executives to embrace crypto, but some experts say the CEO’s preferred financial instrument, exchange-traded funds (ETFs) It warns that digital assets are an investment vehicle that is far from the original ideal and could push the industry in the wrong direction.

ETFs are nothing more than traditional investment vehicles backed by Bitcoin (BTC), but the main difference is that they are traded on regulated stock exchanges through regulated brokers. Such a structure may be unacceptable for Bitcoin. Bitcoin was launched in 2009 as an Internet-based peer-to-peer payment network designed by an anonymous creator and not under government control, partly in the wake of the Wall Street excesses that sparked the global financial crisis the year before. Thing.

So even if Fink’s shift to a more favorable view helped support Bitcoin’s recent rally (82% year-to-date), the reception from crypto enthusiasts may be mixed. do not have.

“Crypto assets are losing the story,” said Jim Bianco, president of Bianco Research, who said crypto assets “should be about decentralization, permissionlessness and self-sovereignty. It’s great to be excited that it will be a more accessible poker chip, and will benefit those who are into gambling in the short term, but it will not deliver on the real promise of crypto assets. It doesn’t help,” he said.

Fink CEO doesn’t care about the idea of ​​crypto assets

Fink was known to be crypto-skeptical until this week, once calling bitcoin a ‘money laundering indicator’, but on Friday he said it could ‘revolutionize finance’. said to be sexual.

Larry Fink, BlackRock CEO:

2017: Bitcoin is an index of money laundering.

2023: Bitcoin could revolutionize finance. Files for a Bitcoin ETF.

I am old enough to remember… pic.twitter.com/CAX3mwb7DA

— Gabor Gurbacs (@gaborgurbacs) July 5, 2023

But rather than praising the core ideas behind digital asset markets, primarily decentralization, Fink said the asset manager’s main goal was to make trading and investing in Bitcoin easier and cheaper. said that. Some experts have expressed concern that BlackRock is entering for the wrong reasons.

It is also pointed out that it goes against the raison d’etre of Bitcoin

Jim Iourio, managing director of TJM Institutional Services and a veteran futures and options trader, said, “Like Bitcoin exchanges, ETFs are the single most important feature of Bitcoin. The argument is that it ignores what some believe it does: the ability to manage one’s own funds without trusting a third party.” It goes against the whole thing,” he said.

Cryptocurrencies are built on the idea that money should not be tied to third parties or intermediaries such as banks or governments, so they are immune to manipulation of any kind.

In the case of ETFs, the provider (which will become BlackRock if it gets regulatory approval to launch an ETF) owns the underlying assets and sells the funds to investors. Even though crypto assets were built to change this practice.

Alex Thorn, head of research at digital asset finance firm Galaxy, said in a report this week that “so-called mainstream corporate adoption will bring a large number of new entrants to Bitcoin. “There is a risk that new entrants will not care about and protect the decentralized nature, which is the primary factor that makes Bitcoin more valuable than other centralized instruments.”

But with the CEO of the world’s largest asset manager defying views from a few years ago and openly admitting that he now sees Bitcoin as “digital gold,” there’s something so negative about it, at least for now. It shouldn’t be. Validation by people like Fink could help with mass adoption, furthering Bitcoin’s use by mainstream companies and public awareness.

｜Translation: CoinDeskJAPAN
｜Editing: Rinan Hayashi
｜Image: Shutterstock
｜Original: BlackRock CEO’s Turnabout on Bitcoin Elicits Cheers, Skepticism of Crypto Cred