Coinbase, one of the world’s largest and most popular digital currency exchanges, is partnering with investment giant BlackRock to offer its clients the opportunity to trade digital assets.
Coinbase and BlackRock team up
Joseph Chalom, Global Head of Strategic Ecosystem Partnerships at BlackRock, explained in a recent interview:
Our institutional clients are increasingly interested in gaining exposure to digital asset markets and are focused on how to efficiently manage the operational lifecycle of these assets. This connectivity will allow clients to manage their bitcoin exposures directly within their existing portfolio management and trading workflows for a portfolio-wide view of risk across all asset classes.
It’s interesting to see BlackRock make this change. Larry Fink, the company’s president, said about five years ago that bitcoin was the “money laundering index.” He didn’t trust cryptocurrencies, nor did he have any desire, it seems, to get involved with them.
However, it looks like things have changed not exactly for Fink, but also for the company’s clientele. They are starting to realize the true prowess of digital assets and want to get involved. They are eager to take advantage of digital currency offerings and expand their portfolios beyond the standard investment tools they have been exposed to.
For this reason, it appears that BlackRock feels they have no choice but to continue offering digital currencies to customers, regardless of how Fink feels. Executives know there is business to be lost if they don’t change with the times, and offering cryptocurrencies is likely to please everyone sitting at the BlackRock table.
Owen Lau, analyst at Oppenheimer & Co., gave his thoughts on the new partnership, commenting:
After this validation, Coinbase will be able to partner with more traditional financial industries. This shows that even with BlackRock’s size, they will be partnering with a native cryptocurrency company rather than developing their own features.
The move comes at a pretty interesting time, given how poorly the crypto space has been doing lately. Bitcoin, for example, is down over 60% from its all-time high of over $68,000 per unit last November. At the moment, the asset is struggling to maintain a position in the $20K range, with the entire crypto space losing around $2 trillion in overall valuation.
A lot of controversy surrounding the exchange
The fact that the space is in such a weak state and yet so many institutions still want to take advantage of it is proof that digital currencies are becoming much more mainstream and legitimate in people’s eyes, even as prices fall.
Coinbase has been at the center of a lot of controversy lately. The company is under SEC investigation and a former employee has been accused of insider trading.