The crypto industry is making headway in gaining the support of major players on Wall Street, with BlackRock being a notable example. BlackRock’s founder and CEO, Larry Fink, previously referred to Bitcoin as “an index of money laundering” in 2017. However, in 2023, BlackRock submitted an application for a Bitcoin spot ETF and Fink praised Bitcoin, stating that it could revolutionize finance and digitize gold.
Other prominent figures in the financial world, such as Ken Griffin of Citadel Securities, have also had a change of heart about the crypto sector. Griffin previously referred to it as a “jihadist call” against the USD, but his company is now backing a platform for institutional investors to trade digital currencies. Fidelity Investments, the largest 401(k) administrator in the US, is also making moves in the crypto space, allowing workers to invest in Bitcoin and investing in a new crypto exchange through its subsidiary, Fidelity Digital Assets.
Initially, the crypto industry aimed to disrupt Wall Street and the US financial system. However, it now seems that Wall Street is joining the crypto industry’s ranks. This shift comes at a time when the crypto sector is relatively weak, having experienced a year-long bear market and increased regulatory scrutiny from the US SEC.
The current situation in the US has put the crypto industry at a crossroads, with decreased interest in digital assets due to price drops, company failures, and regulatory crackdowns. However, financial giants see an opportunity to offer regulated crypto products and services, attracting users who are willing to accept these offerings.
The question now is whether the crypto industry’s goal of democratizing finance can withstand the current treatment from regulators. According to Matthew Sigel of VanEck, assets often move from weak to strong hands during bear markets, and this seems to be happening in the crypto sector as well.