BlackRock partners with Coinbase and gives it a boost in the stock market

BlackRock has confirmed that it has partnered with them Queen Piece To facilitate the management and trading of Bitcoin for institutional investors, through the Aladdin investment management platform that belongs to the exchange.

This move by BlackRock, the world’s largest investment fund, has suddenly become a huge boost to both Coinbase and the crypto ecosystem. Thanks to this, Coinbase shares rose nearly 30% to $106.31 on the New York Stock Exchange, causing a temporary suspension of operations.

In fact, this honor has become a savior for Coinbase, because since the beginning of the year, with the fall of Bitcoin (BTC), which lost nearly half of its value in the first weeks of 2022, along with the rest of the crypto assets. The picture was not good for the stock exchange, which was going through financial difficulties.

It is worth noting that with the market in free fall, in May the ecosystem took a new and severe blow, after the collapse of the Terra ecosystem, causing the market to plunge to lows not seen in several months.

With the resounding fall of Luna (LUNA) along with its algorithmic stablecoin TerraUST (USDT), Singapore-based crypto-asset firm Three Arrows Capital (3AC), which has leveraged heavily with more than $200 million, has collapsed.

This fall of 3AC, which had to temporarily shut down operations by withholding its users’ funds, was followed by others less related, but equally shocking to the crypto ecosystem, causing a bloodbath that scattered the value of all cryptocurrencies and tokens.

As a result of this collapse that the crypto winter brought with it, financial authorities began to look closely at operations using cryptocurrencies and tokens, due to the uncertainties that characterize this market in the first half of 2022.

The authorities of the United States, as well as the authorities of other countries that are part of the Group of Seven and the European Union, decided to conduct further regulatory scrutiny “on the pretext” of detecting dangerous and harmful moves of investors, but also with the aim of creating new laws for the sector.

In the midst of this crisis and heightened scrutiny, the US Securities and Exchange Commission (SEC) discovered that a former Coinbase employee named Ishan Wahi was part of an insider trading scheme, colluding with his brother Nikhil Wahi, and his friend Samir Ramani.

As a result, the SEC gave a portion of the powers to the Department of Justice (DOJ) in that country, to prosecute those involved, who earned a collective profit of about $1.5 million (approximately) from information trafficking, according to the Department of Justice.

This showed that Coinbase was in the sights of the US financial authorities, at a time when the crypto winter was negatively affecting the finances of the company, which had to choose to conduct a large number of layoffs, before falling into bankruptcy or bankruptcy.

Meanwhile, Coinbase faces a new investigation by the Securities and Exchange Commission, which seeks to determine whether the company is allowing US investors to trade digital assets that should have been registered as securities.

Hence, at the end of last month, rumors about a SEC investigation, along with unconfirmed information about a possible sale of shares by major investors in the platform, led to Coinbase losing about 20% of the platform’s value. Stock market.

However, BlackRock’s support for Coinbase represents an important milestone for the exchange and also an opportunity to weather the crisis. In addition, the Aladdin platform integration phase begins for all its clients, to provide investment and operations management services, trading management, custody and reporting services for its cryptocurrencies.

In this regard, Aladdin CEO Joseph Shalom explained that amid the growing interest of Coinbase customers in owning digital asset markets, Aladdin’s role will be to efficiently manage those assets.

Since the big companies in this sector have started investing in Bitcoin and other digital assets, and reaping huge benefits, a large part of the traditional financial institutions on Wall Street have begun to expand towards the cryptocurrency ecosystem, blockchain technology, DeFi and Web3 services. .

Most of these big investors maintain that given the expectations for the future increase in the value of Bitcoin and the rest of the crypto assets after the end of the crypto winter, it is best to enter a bear market to benefit.

For Coinbase, the BlackRock partnership means the oxygen tank that will keep it afloat during criptoinvierno And another opportunity for growth during the crisis he is going through.

Coinbase’s partnership between BlackRock and Aladdin is an exciting milestone for our companyBrett Tigpool, President of Coinbase Institutional, and Greg Tosar, Vice President of Institutional Product, said in separate statements.

“We are committed to driving the industry forward and creating new hotspots as institutional adoption of cryptocurrencies continues to accelerate,” Coinbase officials added.

For its part, for the largest asset manager in the world to decide to partner with Coinbase, it only had to take into account the size of the exchange market, as well as its role in providing trading, custody and brokerage services. Your informational capabilities.

Joseph Chalom, Global Head of Strategic Ecosystem Partnerships at BlackRock, said in a statement:Our institutional clients are increasingly interested in exposure to the digital asset markets and focused on how to efficiently manage the operational lifecycle of these assets.“.

BlackRock’s move comes after BlackRock CEO Larry Fink said in an interview in March that the company is studying the growing importance of digital assets and stablecoins and how they can be used to help customers.

BlackRock aims to partner with leading companies in the sector, as part of a broader strategy in its expansion into crypto-assets, so the partnership with Coinbase has been key to positioning itself within the ecosystem.

Indeed, in April, the company joined a group of investors in Circle Internet Financial, the issuer of the US dollar, indicating that it will seek to act as the main manager of the stable cash reserves of this currency.

This association will undoubtedly have major benefits for Coinbase, but also for the crypto ecosystem in general, because as institutional investors start pumping more capital into the market, a recovery is just around the corner.

court notice “Investing in crypto assets is unregulated, may not be suitable for retail investors and may lose the entire amount invested”

 

 

 

 

 

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