BlackRock, world’s largest money manager has entered a partnership with crypto exchange Coinbase on Thursday. BlackRock now will be able to offer institutional clients access to cryptocurrency trading along with custody services.
This is a positive news amidst negative sentiment spread across the industry, the crypto downturn has forced investors to dump their assets owing to an anticipated recession. Despite considerable layoffs, BlackRock’s partnership has managed to help investors regain confidence in the digital asset industry.
The institutional clients of the renowned investment management firm who own digital assets will be able to get help from Aladdin, which is the asset manager’s host of software tools in order to manage their investment portfolios along with conducting risk analysis on these decisions.
Joseph Chalom, Global head of strategic ecosystem partnerships in BlackRock mentioned,
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 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.
BlackRock Teased A Possibility Of Offering Crypto Access To Investors
BlackRock has previously mentioned that it was looking forward to an integration that would help investors gain access to digital assets. CEO Larry Fink stated that the organisation was exploring different ways of offering crypto services to their valued clients hinting that clients expressed sustained interest in the cryptocurrency market.
Coinbase has been no exception in terms of facing the aftermath of the crypto bloodbath, it has witnessed tough competition and also regulatory issues. This partnership could aid Coinbase and help the company walk on a path of recovery. The increased institutional inflows could prove to be beneficial for the crypto exchange.
Coinbase President Emilie Choi, stated in one of his emails that,
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
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Bitcoin Acquired Will Remain In Coinbase Custody Trust Company
Coinbase Custody reserves the right to hold the assets in behalf of its clients in cold storage with an insurance up to $320 million. Bitcoin acquired through the partnership shall be in custody with Coinbase Custody Trust Company.
It is a regulated fiduciary in New York. Users of the Coinbase Prime are allowed to transfer funds between the wallets and this can be carried out internally.
This also means the transfer of Bitcoin from the platform does not happen to be an option at the moment. BlackRock currently serves more than 1,600 institutions in United Nations and Canada.
Featured image from GOBankingRates, chart from TradingView.com