BlackRock To Partner With Coinbase For Crypto Services

August 5, 2022 4:30 pm

Blackrock is currently the world’s largest asset manager as it currently manages funds that total to around $10 trillion.

The mega firm has now revealed that it will be taking a bigger jump into the crypto space by partnering with Coinbase to provide institutional clients with crypto services.

Via this new partnership, Blackrock’s investment management platform Aladdin will be able to connect to Coinbase Prime to provide trading and brokerage services.

This new announcement is quite the contrast to Blackrock’s previous position where its CEO Larry Fink called crypto a “money laundering service” a few years ago.

It seems that much has changed since then.

TechCrunch reports:

The news marks a major shift for BlackRock, whose chairman Larry Fink called bitcoin an “index of money laundering” five years ago. Since then, the asset management firm has made small advances into web3, introducing bitcoin futures trading to its platform and to a couple of its funds last year.

Fink told shareholders in a letter in March this year that BlackRock was studying “digital currencies, stablecoins and the underlying technologies” to see how they could help the firm serve its clients.

Coinbase Prime has 13,000 institutional clients using its suite of tools today, according to the company. It remains unclear when the companies plan to add to the platform other cryptocurrency offerings outside of bitcoin.

It’s a big day for Coinbase. Meta CEO Mark Zuckerberg also announced today that his company has added an integration with Coinbase’s wallet, among other third-party crypto wallets, to the Instagram platform. Coinbase’s stock shot up over 17% as of 11:00 am EST today and it is also up over 70% in the past month, demonstrating that the company has begun to recover from lows it reached in May as the crypto market pullback hit a trough.

This new partnership with Coinbase comes during a time where the overall crypto market has caused massive layoffs for crypto firms.

Coinbase was no exception as it had laid off roughly 18% of its employee base similar to many other crypto exchanges.

However, the fact that a large institutional asset manager like Blackrock is still involved indicates that this may only be a short term market cycle before the next bullish cycle finally begins.

Not all crypto firms were affected as companies like Ripple and Binance continue to expand and look for potential acquisitions to take advantage of.

CoinDesk reports:

“This connectivity with Aladdin will allow clients to manage their bitcoin exposures directly in their existing portfolio management and trading workflows for a whole portfolio view of risk across asset classes,” he added.

The access will be granted through Coinbase Prime, an existing integrated trading platform for institutional crypto investors. The companies will continue to develop the platform’s integration and roll out different functions in phases, the blog post said.

“BlackRock’s deep expertise in investment management technology, combined with Coinbase’s integrated and secure trading, custody and prime brokerage product suite will facilitate greater institutional access and transparency to digital asset investing,” Coinbase President Emilie Choi said in an emailed statement.

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