BlackRock Announces Spot Bitcoin Private Trust for US Clients: All Details

BlackRock, the world’s biggest asset manager, has launched a spot Bitcoin private trust for institutional clients in the United States, according to a blog post on its website. The trust will track the performance of Bitcoin, offering direct exposure to the price of the digital currency, BlackRock said.

“Despite the steep downturn in the digital asset market, we are still seeing substantial interest from some institutional clients in how to efficiently and cost-effectively access these assets,” the company said.

The move comes a week after cryptocurrency exchange Coinbase said it had partnered with BlackRock to provide its institutional clients with access to crypto trading and custody services. Coinbase shares after the announcement. 

Last week’s agreement offers some positive news for the company which, like many in the crypto sector, has been battered by a slump in crypto asset prices as investors fled risky assets amid geopolitical turmoil, rising rates and worries of an impending recession. Coinbase has been among the worst hit, with shares down over 60 percent so far this year.

The company’s institutional trading platform for crypto assets, Coinbase Prime, will provide crypto trading, custody, prime brokerage and reporting capabilities to institutional clients on BlackRock’s Aladdin, who are also clients of Coinbase. Aladdin offers a suite of software tools designed to help institutional investors manage their portfolios.

The latest developments underscore how traditional institutions including pension funds, hedge funds and banks have been pushing into crypto assets lately, wagering the alternative asset class is here to stay.

Even as, the crypto sector has been battered by a slump in asset prices as investors fled risky assets amid geopolitical turmoil, inflation and worries of an impending recession.

© Thomson Reuters 2022