For the past few years, US-based cryptocurrency platform, Coinbase, has been roped in by the world’s largest assets manager, BlackRock to provide crypto solutions to its clients.
BlackRock currently manages over $10 trillion worth of assets and has been looking to enter the crypto space for quite some time.
As Coinbase has been working in this field for the past few years, looking at their experience in developing and strengthening crypto markets for a global audience, they have selected them as their partners.
With the Coinbase platform, BlackRock’s end-to-end investment management platform will get direct access to crypto, starting from Bitcoin (BTC) and other cryptocurrencies listed on Coinbase through connectivity with its Prime service.
Coinbase Prime will provide crypto trading, custody, brokerage, and reporting capabilities to BlackRock’s clients as well as users of Aladdin, portfolio management software that helps the institutional clients to communicate effectively, address problems quickly, and make informed decisions at during the investment process.
BlackRock Investment Management Corporation has joined forces with Coinbase in an effort to make it easier for institutional investors to trade and manage Bitcoin.
BlackRock’s foray into the cryptosphere comes at a time when the market is plagued with fund slumps and inquiries from governments all over the world, despite its goal of concentrating on enormous BTC investors.
After months of difficulty against the backdrop of the industry slump, this alliance seemed to bring respite for Coinbase.
Coinbase shut down its Pro service and has been under investigation by US authorities for securities violations after firing 18% of its workers.
Commenting on this development, BlackRock’s Global Head of Strategic Ecosystem Partnerships Joseph Chalom in his blog said:
“Our institutional clients are increasingly looking to participate in the markets for digital assets and are concentrating on effective operational lifecycle management of these assets.”
Chalom blog further adds:
“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.”
As the safest and most reliable gateway to the crypto economy, Coinbase has been instrumental in the growth and strengthening of the cryptocurrency markets over the past few years.
The integration comes four months after BlackRock CEO Larry Fink announced the company will investigate ways to sell digital assets to its clients, underscoring institutional investors’ persistent interest in the cryptocurrency market.
To offer institutional clients, Coinbase has a full-service platform to access the crypto markets at a scale that combines these capabilities with cutting-edge security, insurance, and compliance processes.
Coinbase’s clients include corporate treasuries, financial institutions, asset allocators, hedge funds, and other organizations. Aladdin is already used by more than 200 institutions, including banks, businesses, pension funds, insurance companies, and governmental organizations.
Due to the decline in cryptocurrency values, fierce competition, and a recent regulatory jolt, Coinbase has had a difficult year. Bringing in more institutional capital may be the key to its recovery and a broader upturn for the digital asset sector as a whole.
Emilie Choi, president of Coinbase, wrote in an email said that BlackRock’s deep expertise in investment management technology along with Coinbase’s integrated and secure trading, custody, and prime brokerage will provide better access and transparency to digital asset investing.
The blog reads:
“We are committed to advancing the industry and creating new access points as institutional crypto usage continues to grow swiftly and we serve as the trusted partner enabling institutions to engage in and do business in the crypto economy. We are excited to advance Coinbase’s aim to broaden crypto accessibility and transparency and are honoured to work with a pioneer in the industry”.
BlackRock and Coinbase will gradually roll out features to interested customers as the platform connection develops. Access is only permitted for organizations that have agreements with both Aladdin and Coinbase.