BlackRock Executive Highlights Importance of Digital Identity Infrastructure in DeFi

Trading without identity verification is illegal

On the 22nd, Joseph Charom, head of strategic ecosystem partnerships at BlackRock, the largest asset management company in the United States, announced on the 22nd that when institutional investors participate in decentralized finance (DeFi), counterparties in bilateral transactions He said that the identity verification of the

Speaking as a panelist at the State of Crypto Summit in New York, Chalom said that for large institutional investors like BlackRock, “the first question is who you’re trading with, and that’s the first question. If you don’t know, you risk going to jail,” he said, pointing out that the current lack of infrastructure for digital identities is a major obstacle for institutional investors to enter.

From an anti-money laundering and know-your-customer (KYC) standpoint, he said, “We need to have a clear understanding of who is participating in the pool.” While acknowledging the potential of DeFi, he added that he is not optimistic about a short-term solution to the digital identity problem.

The key to popularization of tokenization

On the other hand, Chalom sees the introduction of tokenization as “very important in shaping the ecosystem in the long term.” In order to realize this, it is necessary to cooperate with reliable participants and build a good infrastructure. It pointed out.

Chalom said the cryptocurrency industry needs to converge around certain assets and prioritize real-world use cases.

black rock influence

BlackRock, the world’s largest investment management company, has been making steady moves to enter the cryptocurrency industry since last year.

In a message to shareholders last March, the company’s CEO Larry Fink spoke about the usefulness of global digital payments, and to respond to growing customer interest, the company plans to combine digital currencies and stablecoins. He said that he is researching the underlying technology.

connection:BlackRock CEO: “We are working on digital currencies and stablecoins”

In April of the same year, BlackRock invested in Circle, which issues the USD-denominated stablecoin USDC. In the same month, an ETF (exchange-traded fund) related to the cryptocurrency and blockchain industry was listed on the New York Stock Exchange “Arca.”

In August 2010, it announced a partnership with major US virtual currency exchange Coinbase. Introduced Coinbase’s “Coinbase Prime” service into the company’s portfolio management system, and started offering Bitcoin trading, custody, and market data services to customers.

connection:BlackRock partners with Coinbase to offer cryptocurrency trading

On June 15th, BlackRock surprised the market by applying to the U.S. Securities and Exchange Commission (SEC) for a Bitcoin physical investment type exchange-traded fund (ETF). The historic move reversed market prices for bitcoin and cryptocurrencies, which had fallen following the SEC lawsuits against Binance and Coinbase.

The Bitcoin ETF application by the world’s largest asset management company gives a stamp of approval to the valuation of Bitcoin as an asset.

After BlackRock’s application, US WisdomTree, Invesco, and Valkyrie Funds have already applied for new physical Bitcoin ETFs, and NYSE Arca, a subsidiary of the US NY Stock Exchange, has changed Grayscale Bitcoin Trust to a physical Bitcoin ETF. I made an application to

The SEC has historically disapproved all Bitcoin spot ETF applications, but BlackRock has received SEC approval for 575 ETF applications in the past, with only one being disapproved. We have a wealth of experience and achievements in managing ETFs.

BlackRock’s “iShares Bitcoin Trust” also includes content that eliminates the possibility of market manipulation regarding the Bitcoin price, which is a concern of the SEC, as much as possible, and future developments will be watched.

connection:What is an exchange traded trust “Bitcoin ETF” | Why the application of BlackRock attracts attention

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