The Bitcoin (BTC) bullish trend in recent weeks has received an additional boost from institutional investment. The alliance between Coinbase and investment manager Blackrock, along with the fact that it announced the launch of the Bitcoin Cash Credit, has not only increased the price of the main cryptocurrency, but also made Bitcoin more attractive in the eyes of investors.
Created in 1988, Blackrock has managed in just 10 years to grow assets under management to $6 trillion, and thanks to its robust M&A strategy, particularly in the area of Exchange Traded Funds (ETFs), Its portfolio of assets under management is the largest in the world, exceeding $10 trillion.
Blackrock’s interest in bitcoin is not new. In August 2021, it announced investments in bitcoin mining companies, and in January of that year it included BTC derivatives among its investment vehicles. Also, in March 2021, the company purchased Bitcoin futures contracts for $6.5 million.
As the company made clear when announcing its agreement with Coinbase to offer Bitcoin to its customers, the decision was Driven by the growing interest of institutional customers in the first cryptocurrency and who seek assistance in managing the lifecycle of such digital assets. Coinbase shares rose above 80% in the days following the announcement of the Blackrock deal.
Bitcoin growth opportunities
Institutional investments in Bitcoin advanced significantly in 2020 when companies such as Microstrategy and Block listed Bitcoin as part of their strategic reserves, CriptoNoticias reported.
The opportunity to gain access to direct exposure to BTC brokered by Blackrock, It is easy for traditional investors to trade this cryptocurrency through regulated investment vehicles.
Blackrock will also open the door for countries, through central banks, to invest in bitcoin. Cryptocurrency group CEO Barry Silbert has claimed that BlackRock’s confidence in bitcoin makes it easier and faster for central banks to invest in bitcoin.
In these comments from Silbert, who runs Grayscale’s bitcoin fund operations, He referred to BlackRock’s dealings with central banks, indicating that they might decide to invest in bitcoin.
With access to trust funds based on Bitcoin, futures and other BTC derivatives, the investor does not need to enter the spot Bitcoin market, but rather focuses his exposure to this asset on the instruments he knows well in his investment activities. Blackrock’s importance in this context lies in its ability to attract more capital into Bitcoin by encouraging more incorporation of institutional investors.