Coinbase, BlackRock Join Hands to Focus on Institutional Investors in Crypto Sphere

In a bid to ease-out institutional investors to trade and manage Bitcoin, BlackRock investment management corporation has teamed-up with Coinbase. Founded in 1988, BlackRock claims to be the largest asset manager in the world with $10 trillion (roughly Rs. 7,91,89,500 crore) in assets under management as of January this year. While it aims to focus on mammoth BTC investors, BlackRock's entry into the cryptosphere comes at a time when the sector is riddled with fund slumps and investigations from governments around the world.

For Coinbase, this partnership seemingly brought along relief after months of having struggled in the backdrop of the industry slowdown. After having fired 18 percent of its workforce, Coinbase drew curtains on its ‘Pro' service and has been under investigation by the US authorities for securities violation.

“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,” Joseph Chalom, Global Head of Strategic Ecosystem Partnerships at BlackRock said in a blog post.

Coinbase shares surged 15 percent ever since the announcement of its partnership with BlackRock surfaced.

BlackRock clients will be able to use its Aladdin investment-management system to oversee their exposure to Bitcoin and facilitate financing and trading on Coinbase.

“BlackRock's end-to-end investment management platform, with direct access to crypto, starting with Bitcoin, through connectivity with Coinbase Prime. Coinbase Prime will provide crypto trading, custody, prime brokerage, and reporting capabilities to Aladdin's Institutional client base who are also clients of Coinbase,” the post added.

The regulatory risks from the BlackRock-Coinbase partnership are manageable because it's starting with Bitcoin, which has clearer regulatory status in Washington than other virtual digital assets, a Bloomberg report explained.