Larry Fink, CEO of investment management firm BlackRock, said the ongoing war between Russia and Ukraine will spur other countries to re-analyze their dependencies on traditional payment infrastructure and fiat currencies.
BlackRock CEO’s Change of Heart
In a letter to BlackRock’s shareholders,’ the exec weighed in on the potential impacts of the invasion and noted that it would boost the adoption of digital assets. The UK, Singapore, Indonesia, and Canada have resorted to regulating digital assets while others like the USA, Pakistan, Brazil have proposed to regulate instead of imposing an outright ban.
Nevertheless, several countries have already started to play a more active role in the cryptocurrency sector, something that started even before the war’s outbreak. However, Fink believes the global economic scenario may push towards a payment system that includes digital currencies.
The NYC-based behemoth’s CEO added that a carefully planned global digital payment system could revamp the settlement of international transactions while mitigating the risk associated with money laundering and corruption. He even went on to state that digital currencies can cut down costs of cross-border payments.
“A global digital payment system, thoughtfully designed, can 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.”
To cater to the increasing interest of its clientele, BlackRock is also exploring digital currencies, stablecoins, and the underlying technologies.
Fink hasn’t been a vocal critic of the cryptocurrency industry in the past but has remained uncertain on how Bitcoin will play out over the long term. Despite expressing his fascination for the space, the exec had earlier considered himself to be more in JPMorgan Chase’s Jamie Dimon camp, who had called Bitcoin “worthless.”
BlackRock’s Crypto Trading Services
As reported earlier, the world’s largest asset manager is planning to roll out cryptocurrency trading services. The key is to enter the digital asset space with “client support trading and then their own credit facility.” BlackRock further revealed that will enable market players to borrow from the company by providing cryptocurrencies as collateral.
Last year, the investment giant reported $360K Bitcoin gains after acquiring futures contracts via Chicago Mercantile Exchange (CME).