- In his annual letter to investors, BlackRock CEO Larry Fink cautioned that digital assets could undermine America’s economic edge.
- Fink asserts that the US Dollar is at risk of losing its status as the world reserve currency to digital assets such as Bitcoin.
- According to CoinShares’ weekly report, crypto ETFs experienced inflows of $225 million last week.
In an annual letter to investors released on Monday, BlackRock CEO Larry Fink highlighted that the US national debt could lead investors to view Bitcoin as a more secure asset, potentially replacing the Dollar’s global reserve status. Additionally, Bitcoin exchange-traded funds (ETFs) noted inflows of $196 million last week, with altcoin products seeing inflows for the first time in four weeks, as reported by CoinShares.
Bitcoin has the potential to replace the US Dollar as a global reserve: BlackRock CEO
In his annual letter, BlackRock CEO Larry Fink expressed concerns about the impact of increasing US national debt on the Dollar’s status as a global reserve currency.
Fink affirmed his strong belief in digital assets, calling them an extraordinary innovation. He warned, however, that if investors start viewing digital assets like Bitcoin as a “safer investment than the Dollar,” it could erode America’s economic leverage.
He pointed out that while the US Dollar has been the world’s reserve currency for many years, this dominance is not guaranteed indefinitely.
“If the US does not manage its debt effectively, and if deficits continue to grow, America risks being supplanted by digital assets such as Bitcoin,” Fink wrote.
He also discussed the significance of tokenizing real-world assets for investors, claiming that tokenization “makes investing much more democratic,” and expressed his belief that tokenized funds will become as commonplace for investors as ETFs.
BlackRock is the leading issuer of tokenized real-world assets, with its BlackRock USD Institutional Digital Liquidity (BUIDL) Fund approaching nearly $2 billion.
The asset manager oversees the largest crypto ETF, iShares Bitcoin Trust (IBIT), with over $39 billion in assets under management (AuM), and has also launched its iShares Bitcoin ETP in Europe to enhance its fund exposure in that region.
Meanwhile, global crypto ETFs saw net inflows of $226 million last week, as reported by CoinShares. Bitcoin attracted the largest inflows, totaling $195 million. However, the overall assets under management for Bitcoin ETFs have reached their lowest point—$114 billion—since the post-US election rally.
Additionally, altcoin products saw inflows of $33 million after a four-week period of outflows. Positive performing altcoin ETFs included Ethereum, XRP, Solana, and SUI, with inflows of $14.5 million, $4.8 million, $7.8 million, and $4.0 million, respectively.
