Friday 25 March 2022 10:46 am

Wealth manager Blackrock confirms crypto plans as demand soars

The world’s biggest asset manager Blackrock has confirmed plans to explore how crypto assets can be used to serve its clients.

In a shareholder letter published yesterday Larry Fink, the chief executive of Blackrock, revealed the company is responding to increased client demand by exploring crypto and blockchain technology.

The comments come after a source at Blackrock told Coindesk that the company, which manages over $10trillion (£7.3trillion) in client assets, plans to offer support to clients trading crypto assets and allow investors to stake crypto as collateral for loans.

“As we see increasing interest from our clients, BlackRock is studying digital currencies, stablecoins and the underlying technologies to understand how they can help us serve our clients,” Fink confirmed in yesterday’s investor letter.

Fink added that a “thoughtfully designed” global payments system has the capacity to “enhance the settlement of international transactions while reducing the risk of money laundering and corruption.”

“Digital currencies can also help bring down costs of cross-border payments, for example when expatriate workers send earnings back to their families,” he wrote.

Fink commented that the conflict between Ukraine and Russia has the potential to accelerate the adoption of digital currencies by prompting countries to re-evaluate their currency dependencies.

“Even before the war, several governments were looking to play a more active role in digital currencies and define the regulatory frameworks under which they operate,” Fink added, citing the US Central Bank’s plans to explore a US digital dollar.

Financial heavyweights including Citi bank and Morgan Stanley have already made the jump into digital asset research amid an explosion of investor interest in crypto. While financial services providers are increasingly sold on crypto multiple financial regulators, including the UK’s Bank of England, have raised concerns that digital assets pose a financial stability risk.