BlackRock’s Bitcoin effect - price hits US$30k

Name: Markets with Madison: BlackRock’s Bitcoin effect
Uploaded: 2023-06-23T08:13:11+12:00
Description: BlackRock’s application for a Bitcoin ETF has pushed the price of the digital asset up 80 per cent for the year, above US$30,000. Plus, how the Fed’s interest rate pause may prolong pain for the U.S economy.

By Madison Reidy

Senior Business Journalist, host of Markets with Madison·NZ Herald·

23 Jun, 2023 04:45 AM2 mins to read

BlackRock’s application for a Bitcoin ETF has pushed the price of the digital asset up 80 per cent for the year, above US$30,000. Plus, how the Fed’s interest rate pause may prolong pain for the U.S economy.

BlackRock’s surprising move to validate Bitcoin and expose more investors to it, has pushed the price of the digital asset above US$30,000 - and that could be just the start.

“It blindsided me,” chief investment officer of the Australian crypto-fund Magnet Capital, Benjamin Celermajer, told Markets with Madison.

“Structurally, it does change the game.

“Having them [BlackRock] in this space will bring that level of institutionalisation and sophistication that I think a lot of investors have been waiting for.”

The world’s largest asset manager lodged an application with the US Securities and Exchange Commission (SEC) this month to launch a Bitcoin spot price exchange traded fund (ETF) on the Nasdaq called iShares Bitcoin Trust.

Such a fund currently doesn’t exist on any market.

If approved, it would see BlackRock buy Bitcoin, give it to Coinbase to hold in custody, and allow investors to trade that BlackRock-owned Bitcoin through the ETF.

BlackRock’s timing is staggering - Coinbase was sued by the SEC two weeks ago. (You can watch my episode on that here).

In today’s episode, Celermajer discusses what this move means for the long-term valuation and adoption of Bitcoin, and the demand for its limited supply.

Plus, Westpac’s Chief Economist Kelly Eckhold explains why the US Federal Reserve’s signal of more interest rate hikes has not hurt equity market valuations.

Get investment insights from the experts on Markets with Madison every Monday and Friday on the NZ Herald.

Disclaimer: The information provided in this programme is of a general nature, and is not intended to be personalised financial advice. We encourage you to seek appropriate advice from a qualified professional to suit your individual circumstances.

Madison Reidy is the host of New Zealand’s only financial markets show Markets with Madison. She joined the Herald in 2022 after working in investment, and has covered business and economics for television and radio broadcasters.