BlackRock Chief Investment Officer Admits Bitcoin is a Sustainable Asset Despite Crisis The Ecoinomic

Speaking in an interview with Yahoo Finance on June 16, Rieder noted that "bad cash flow" around Bitcoin may be the main cause of the crisis but he believes crypto assets still play an important role in the future financial system.

"You're seeing a lot of leverage being abused in the cryptocurrency space that will quickly be destroyed. I still think bitcoin is a durable asset. It's a long-term business, but there's too much cash built around BTC."

It is highly likely that CIO BlackRock is referring to the disastrous chain of events that are directly threatening the crypto industry of cryptocurrency lending platform Celsius sparked by the stETH-Alameda-Celsius "Chain Effect." At the time of the article, Celsius has not yet opened the door to withdrawals, swappings and crypto transfers between user accounts after a sudden freeze early last week.

BlackRock Chief Investment Officer Admits Bitcoin is a Sustainable Asset Despite Crisis

Celsius has even begun hiring its own lawyer to prepare for the prospect of bankruptcy. Things got even worse when the securities regulators of five U.S. states began investigating the platform. In addition, Celsius itself became the indirect catalyst for the collapse of Three Arrows Capital, the well-known hedge fund that quickly "suffered liquidity problems", which was massively liquidated, leading to a wave of negativity that continued to be imposed on Tether (USDT) and the DeFi space. On June 17, MakerDAO stopped pumping money to Aave for fear of risks from Celsius.

Regarding the next price action, Rieder warned that with too strong shock pressure "besieging" Bitcoin, the asset will likely exceed the tolerance and undergo the next deep correction before a new rally.

"My feelings in all these situations are pretty bad. It's hard to say what fair value is. Like so many other assets, you can see in two to three years, they'll be higher than they are today."

In a separate development, BlackRock's deputy chief executive, Alex Brazier, said the stock front was in a similarly bad state. He therefore advised investors not to buy at a bearish time and noted BlackRock remained neutral while observing the next general financial market movement.

Overall, it can be seen that the financial empire that manages assets worth approximately $10 trillion is showing a strong interest in the crypto industry, a far cry from what the organization did in 2021. The move is an open move that opens the ambition of preparing to offer Bitcoin trading, expanding investments in mining companies and BTC futures contracts.

In addition, in early April, BlackRock will serve as one of the main investors for Circle's $400 million funding round, and will become the main asset manager for the USDC stablecoin's cash reserves. Following the event, BlackRock CEO Larry Fink himself confirmed that his group is seriously researching cryptocurrencies and stablecoins to prepare for the next important plans for the crypto market.