BlackRock, the world’s largest asset manager, has emerged as a prominent advocate for the regulatory approval of a spot Bitcoin exchange-traded fund (ETF). This shift in stance is attributed to a changing sentiment in the asset management industry and a perception that regulatory authorities are aligning more closely with BlackRock’s views. Martin Bednall, a former BlackRock managing director and current CEO of Jacobi Asset Management, shared these insights during a panel discussion at the 2023 CCData Digital Asset Summit in London.
A Change in Attitude
Bednall noted a significant shift in sentiment within both the asset management market and BlackRock itself. He highlighted the transformation in the perspective of BlackRock’s CEO, Larry Fink, who was previously skeptical of cryptocurrencies. In the past, Fink held reservations about cryptocurrency, associating it with illegitimate activities such as money laundering. However, this stance has evolved over time.
Bednall explained that BlackRock’s changing attitude toward Bitcoin and, specifically, the spot Bitcoin ETF, is partly a result of key legal victories in the United States. Notable cases mentioned were Ripple’s success against the Securities and Exchange Commission (SEC) in July and Grayscale’s recent favorable interactions with the SEC.
Shift in the “Mood Music”
The changing “mood music,” as Bednall described it, reflects a more favorable outlook on cryptocurrency and the spot Bitcoin ETF. While the timing of approval remains uncertain, the evolution of BlackRock’s stance is evident. The transformation from viewing Bitcoin as a dubious asset to considering it a global digital gold has been significant.
Top-Down Changes at BlackRock
Bednall emphasized that this change within BlackRock is not isolated; it reflects broader dialogues and shifts in sentiment within the regulatory landscape. BlackRock maintains close ties with regulatory authorities worldwide, and its interactions suggest an evolving regulatory stance on cryptocurrency.
Bullish Outlook for BlackRock
Despite the SEC extending the review period for spot Bitcoin ETF applications from BlackRock and other firms, Bednall is optimistic about BlackRock’s potential to dominate this market. He predicts that BlackRock will amass “the bulk of the assets under management (AUM)” in this sector.
Furthermore, Bednall anticipates that the SEC may approve all the applications simultaneously, avoiding granting any firm a first-mover advantage. This approach aligns with the desire for fairness and consistency in the regulatory process.
BlackRock’s prominent role in advocating for regulatory approval of a spot Bitcoin ETF signifies a significant shift in sentiment within the asset management industry and regulatory circles. The evolving stance of BlackRock’s CEO, Larry Fink, from skepticism to recognition of Bitcoin as a global digital asset underscores the changing landscape of cryptocurrency acceptance among financial institutions. As the industry eagerly awaits regulatory decisions, BlackRock’s active involvement in the dialogue suggests that the spot Bitcoin ETF could be a landmark development in the cryptocurrency market.