BlackRock and Bitcoin, a marriage of convenience (decryption)

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With their powerful tools, the Wall Street giants are already unmatched in the forex and gold markets. Is it time for Bitcoin? BlackRock, the most powerful fund in the financial world, has just entered the cryptocurrency market thanks to a partnership lightly announced by Coinbase.

Coinbase Prime will be integrated with AI Aladdin

If you follow traditional markets, you may have heard of this.Aladdin (network of assets, liabilities, debts and derivative investments),Artificial intelligence developed by the American giant BlackRock. With this amazing technology, the fund manages the majority of its assets ($ 10,000 billion).

BNP Paribas, Fannie Mae, Bank of America, Genworth … More than 250 financial organizations are management system customers of BlackRock and more than 50,000 managers and large investors use its forecasts, which are known for their exceptional accuracy.

With 25 million lines of code and 1,600 full-time developers, Aladdin has worked in the equity, bond and derivatives markets. With the integration of Coinbase Prime (Coinbase’s platform for its institutional clients), this is now being done for cryptocurrencies.

Or rather initially only for Bitcoin (BTC).according to a Coinbase press release.

What role will BlackRock play?

First of all, these are the BlackRock customers who are attracted to invest via Coinbase Prime. Therefore, your BTC investment is managed by the Aladdin Wealth software.one of the trading versions of the system: BTC futures, BTC staking and Bitcoin ETF.

Therefore, buying and selling transactions via the software will become possible. Some analysts also mention the ability for customers to pledge their cryptocurrencies and borrow money on the basis of this guarantee.

Furthermore, Coinbase customers can benefit from this amazing tool. More than 13,000 companies are known to be clients of Coinbase Prime, mainly hedge funds, family offices and individual investors.

“Our institutional clients increasingly seek access to digital asset markets and are focused on how to effectively manage the investment lifecycle in these assets. This integration [de Coinbase Prime, ndlr] with Aladdin will allow our clients to manage their bitcoin positions directly in ongoing portfolio management and trade with a global view of the risks of all their active investments. Joseph Chalom (Black Rock).

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Aladdin is a supercomputer, the pride of the Blackrockers (Image L’Express)

BlackRock’s first investment in BTC dates back to March 2021.

185 bitcoin : this is the number of bitcoins purchased by BlackRock under a futures contract on the Chicago Mercantile Exchange (CME) in the period January-February 2021. With great caution, we only learned about this investment through the publication of a report on the website of the US Securities and Exchange Commission.

It was in detail 37 standard futures contractsfor every 5 BTC, it expires on March 25, 2021.

An unconfirmed investment for a fund the size of BlackRock that still saw him earn just over $ 360,000 in the process …

185 BTC purchased by CME futures

At the same time, a job offer on the giant’s web portal attracted the attention of the financial media. When asked, the representative of the fund limited himself to laconic statements. The position to be filled was named “CTO, Digital Assets and Distributed Ledgers” to increase the existing “human potential”.

While CEO Larry Fink contented himself with staying on the sidelines, BlackRock’s plans became increasingly evident between Bitcoin’s shift in tone and Launch of its own crypto ETF, iShares Blockchain and Tech ETF.

BlackRock cryptocurrency ETF manages $ 7 million

Effect of “BlackRock” on Coinbase?

The markets have realized that such a large player cannot position themselves without significant profits. For Coinbase, analyst consensus has already been raised by several levels to reflect the expected impact of this partnership.

According to the press release, Coinbase (NASDAQ: COIN) shares 10% and closed the session at $ 88.90 after hitting a high of $ 92.66 in early US trading. In the past five days, rumors about the partnership have already won 48% of the title.

+ 47.63% in five sessions for the Coinbase stock

Share price aside, this partnership is a breath of fresh air for Coinbase, which has been hit hard by the bear market. We told you in June that the platform was laying off 1,000 employees (18% of their workforce) and trying to find growth drivers in Europe.

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We know it 75% of the daily trading volume on Coinbase comes from institutional clients.. So BlackRock’s partnership with Coinbase, rather than FTX, which has a great relationship with the SEC, makes sense.

If we are already seeing a “BlackRock effect” on the Coinbase share price, we would be interested to see the impact of this partnership on BTC trading volume on the platform.

Around $ 3 billion in BTC is traded on Coinbase every day, compared to over $ 23 billion on Binance. We recently mentioned sharp decline in BTC reserves on the San Francisco platformhas now overtaken Chinese Binance.

Bitcoin at the start of a new bullish cycle?

Instead of starting alone Therefore, BlackRock positions itself as an intermediary … at the moment.

Faced with hyperinflation, institutional investors are actively looking for yields and see the current Bitcoin price as an ideal entry point for a potential bull run. This influx of new players, customers of US megafunds, could be the spark the cryptocurrency markets need.

Bitcoin whales were particularly active in June. in June 14Santiment (specialist in blockchain data tracking). 12,969 transactions of $ 100,000 each. Strongest activity since May 2021 and a strong indication that the key $ 22,000 level is strong support in the eyes of major market participants.

Since then, Bitcoin has made a timid recovery attempt. It closed just above $ 22,600 yesterday.

🐳 There were a total of 12,969 whale transactions worth over $ 100,000 on the #Bitcoin network between yesterday’s 14:00 UTC and today’s 2:00 UTC. This was the highest amount since May 2021, which suggests whales recognize $ 22,000 as a lot of interest in BTC. https://t.co/yX4NY6u8yZ pic.twitter.com/Eb21t8Ks21

– Sentiment (@santimentfeed) June 14, 2022

To understand Bitcoin monetary rates: read our article.

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