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When the average crypto-skeptic changes his mind and dives down the rabbit hole, it’s hardly a newsworthy event. But it’s a different story when the CEO of the world’s largest asset management company does an about face.
Years ago, BlackRock boss Larry Fink called bitcoin an index of money laundering. Now he touts the tech as digital gold and crypto as an international asset.
Did Larry wake up one day and come to this epiphany? Santiago Santos asks.
No, I think there is a lot of institutional demand.
The angel investor spoke to Blockworks on the Empire podcast (Spotify/Apple) about the reasoning behind changing CEO attitudes and the impact of BlackRocks’ moves in the space.
I don’t think Larry took it upon himself to read the whitepaper, come to a massive realization, and then started sending bitcoins to friends and said, Wow, my God! It’s phenomenal!
They’re in constant contact with their biggest customers and they see the window here, Santos says.
When BlackRock sneezes
Podcast host Jason Yanowitz says people don’t realize how influential Larry Fink is, saying he may be the most powerful person in the financial markets in the world.
People underestimate that.
Fink is deeply connected politically, Yanowitz says. When the Federal Reserve started printing [money] in 2020 and had to start buying corporate bonds to support the economy, he says, who did they turn to?
Black Rock and Larry Fink.
When the FDIC came to liquidate the portfolios of Signature and Silicon Valley Bank, who did it?
Black rock.
Santos explains the influence BlackRock has on the wider economy. When BlackRock sneezes, the rest of the world catches a cold.
They hold positions in almost every major company.
Change the story
BlackRocks’ validation of crypto as an asset class is probably the most significant event in a few years, Santos says. It’s the catalyst needed, he says, to change the narrative.
It all comes down to institutional demand, Santos says. I think they have a lot of interest from customers. That’s the only reason they would.
Santos says Fink is a very practical man who understands how he can expand his franchise.
This is an emerging asset class, he says. You’re going to want to capture it with an ETF.
Yanowitz says about half of the major mutual fund groups have CEO-led crypto strategies.
On the other hand, half of them don’t have crypto strategies, he says. These large groups of mutual funds are going to be forced into the market by their customers.
They will all respond, Santos says, not because they believe in space, but because they want to seize an opportunity that their customers, if not offered, will go elsewhere.
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