The interest of large asset managers in Bitcoin is growing: Now Blackrock has also invested a large amount in mining companies. China, of all places, could turn this into a lucrative business.
The world’s largest asset manager Blackrock is increasingly relying on cryptocurrencies: In addition to crypto futures, Blackrock is now also focusing on crypto mining. This emerges from a mandatory SEC announcement of July 30, about which the financial magazine “Forbes” recently reported.
And Blackrock does not start with small sums – the nine trillion dollar asset manager is said to have invested around 383 million dollars in two US mining companies, according to Forbes. Miners – or in German miners – encrypt a block on the blockchain and receive a set number of bitcoins as a reward. This makes miners an important part of the cryptocurrency (Read more about the mining process here).
The companies in which Blackrock invests are making people sit up and take notice: Many miners with their highly complex and high-performance computers are currently still in countries with low infrastructure costs, such as China. However, Blackrock now holds shares in two US-based companies: Marathon Digital Holdings, based in Las Vegas (6.71 percent stake) and Riot Blockchain (6.61 percent stake), based in Colorado. According to the business magazine “Forbes”, Blackrock invests in the companies through two broad funds, the iShares Russel 2000 ETF and iShares Expanded Tech-Software Sector.
China is driving its miners out of the country
Blackrock is thus joining a trend that other asset managers such as Fidely and Van Guard have already initiated. Fidelity recently announced it had invested $ 20 million in Marathon Digital Holdings – also through funds – and Van Guard is currently the largest shareholder in both companies. Blackrock follows in second place with its current investment.
The sudden interest in mining companies in the US is not surprising, given the political line that China is currently taking with regard to cryptocurrencies. China is currently acting restrictively against the mining companies located there, which is why many entrepreneurs are bringing their more expensive, sensitive and power-hungry equipment out of the country. But the demand for cryptocurrencies – and thus for miners – remains high worldwide.
The crypto market shows strong upward trends again
Many cryptocurrencies such as Bitcoin, Ethereum, Cardano or Solana are currently again moving in a strongly bullish trend. That could rekindle interest in cryptocurrencies, similar to the rally in the spring of this year, and thus further increase the trading volume.
Without the mining farms in China, other market participants are needed to close this gap. The US-based companies like Marathon Digital Holdings and Riot Blockchains could ultimately benefit from these developments – and their investors with them.