- In a yearly communication to investors, the CEO of BlackRock, Larry Fink, cautioned that digital assets could undermine America’s economic lead.
- Fink suggested that the US Dollar faces the risk of losing its status as the world reserve currency to digital assets like Bitcoin.
- A recent report indicates that crypto ETFs attracted $225 million in investments last week.
In his annual letter to investors, BlackRock’s CEO, Larry Fink, pointed out that the rising US national debt might lead to the Dollar being supplanted by Bitcoin if investors start perceiving the digital currency as a safer investment. Last week, Bitcoin exchange-traded funds (ETFs) recorded inflows of $196 million, while altcoin products saw inflows for the first time in four weeks, according to a weekly report from CoinShares.
Bitcoin has the potential to take over as the global reserve currency, according to BlackRock CEO
In his annual letter, BlackRock’s CEO, Larry Fink, expressed apprehension about how the growing US national debt could impact the Dollar’s status as the world’s reserve currency.
Fink firmly advocated for digital assets, labeling them as remarkable innovation. However, he cautioned that if investors begin to view assets like Bitcoin as a “safer alternative to the Dollar,” it could diminish America’s economic supremacy.
He remarked that while the US Dollar has held the position of the world’s reserve currency for many years, that status is not guaranteed indefinitely.
“If the US fails to manage its debt and if deficits continue to rise, America could risk losing its standing to digital assets such as Bitcoin,” Fink stated.
He also highlighted the significance of real-world asset tokenization for investors, asserting that tokenization “democratizes investing.” He anticipates that tokenized funds will become as well-known to investors as ETFs.
BlackRock stands as the leading issuer of tokenized real-world assets, with its BlackRock USD Institutional Digital Liquidity (BUIDL) Fund approaching $2 billion.
The firm manages the largest crypto ETF, the iShares Bitcoin Trust (IBIT), with assets exceeding $39 billion. Furthermore, it has introduced its iShares Bitcoin ETP in Europe to widen its fund exposure in that market.
In the meantime, global crypto ETFs reported $226 million in net inflows last week, per the weekly report from CoinShares. Bitcoin attracted the majority of these inflows, totaling $195 million. Nonetheless, the assets under management for Bitcoin ETFs remain at their lowest levels — $114 billion — since the post-US election surge.
Additionally, altcoin products registered inflows of $33 million, breaking a four-week streak of outflows. Among the altcoin ETFs with positive flows were Ethereum, XRP, Solana, and SUI, which recorded inflows of $14.5 million, $4.8 million, $7.8 million, and $4.0 million, respectively.