Coinbase Partners with BlackRock to Offer Crypto to Institutions
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Coinbase – one of the world’s largest and most popular digital currency exchanges – is partnering with investment giant BlackRock to enable its customers to trade digital assets.
Coinbase and BlackRock join hands
Joseph Chalom – BlackRock’s Global Head of Strategic Ecosystem Partnerships – explained in a recent interview:
Our institutional clients are increasingly interested in exposure to digital asset markets and are focusing on how to effectively manage the operational lifecycle of these assets. This connectivity allows clients to manage their bitcoin exposure directly within their existing portfolio management and trading workflows to gain a portfolio-wide view of risk across asset classes.
It will be interesting to see how BlackRock makes such a switch. The company’s chairman, Larry Fink, said about five years ago that Bitcoin is an “index of money laundering.” He didn’t trust crypto and didn’t seem to have any desire to get involved.
However, it seems that things have not really changed for Fink, but for the company’s customer base. They are beginning to understand the true potential of digital assets and want in. They are eager to take advantage of the offerings of digital currencies and expand their portfolios beyond standard investment tools.
Because of this, it seems BlackRock has no choice but to continue offering digital currencies to customers regardless of how Fink feels. Executives know that business is lost if they don’t change with the times, and offering crypto is likely to make everyone at the BlackRock table happy.
Owen Lau, an analyst at Oppenheimer & Co. offered his perspective on the new partnership, commenting:
After this validation, it is possible that Coinbase will be able to work with more traditional financial industries. It shows that even with BlackRock’s size, they are partnering with a crypto-native rather than building their own capabilities.
The move comes at a pretty interesting time considering how bad the crypto space has been lately. Bitcoin, for example, is down more than 60 percent from its all-time high of more than $68,000 per unit last November. Currently, the asset is struggling to maintain its position in the low $20,000 range, and the entire crypto space has lost around $2 trillion in total valuation.
There is a lot of controversy surrounding the stock market
That the space can be in such a weak state, yet so many institutions still want to take advantage of it, is proof that digital currencies are becoming much more mainstream and legitimate in the eyes of the people – even as prices drop.
Coinbase has been at the center of many controversies recently. The SEC is investigating the company and a former employee has been accused of insider trading.