(Adds bitcoin price action, investor reaction)
By Trevor Hunnicutt
NEW YORK, July 16 (Reuters) – BlackRock Inc Chief
Executive Larry Fink on Monday said the world’s largest asset
manager has assembled a working group to look at blockchain
technology and cryptocurrencies such as bitcoin, but cautioned
he does not see massive investor demand.
“We are a big student of blockchain,” Fink said in an
interview with Reuters. Adding that he doesn’t see “huge demand
for cryptocurrencies,” the company has a working group studying
Any move to invest in cryptocurrencies or to use blockchain
by BlackRock would mark a pivot for the company and a major
institutional endorsement for the insurgent technology. The
company managed $6.3 trillion in assets as of June 30.
“BlackRock exploring crypto assets comes as no surprise and
is definitely a positive development for the crypto market,”
said Chris Yoo, a portfolio manager at Black Square Capital
Management LLC, a hedge fund focused on the crypto space.
“As the largest asset manager in the world, its interest in
crypto assets could be a catalyst for upward price movement and
encourage other asset managers, even with more conservative
strategies, to seriously explore investing in the crypto space.”
Bitcoin was trading up 4.4 percent at more than
$6,600 Monday on the Bitstamp exchange, its best showing in more
than two weeks, after an initial report describing the working
group appeared on the website Financial News late on Sunday.
That is still far down from Bitcoin’s all-time peak near $20,000
in late 2017.
Last November, in an interview with Reuters, Fink described
bitcoin specifically as a “speculative” investment that thrives
because of the cryptocurrency’s anonymity. While he sounded an
optimistic tone on blockchain, the technology used to record
bitcoin transactions, Fink also noted the digital currency’s
association with money laundering.
Some asset managers have been quicker to endorse the
potential role of digital currencies. For instance, Fidelity
Investments, a top BlackRock competitor in the fund management
space, has extensively experimented with the technology.
(Reporting by Trevor Hunnicutt
Editing by Jeffrey Benkoe and Nick Zieminski)