Traditional investors will see cryptocurrencies as more than just “retail casinos,” according to Bernstein analysts.
Global investment company AllianceBernstein researchers have said that the entry of Wall Street giant BlackRock into the cryptocurrency market is beneficial for all parties involved.
Last Friday, the largest fund manager in the world, BlackRock, unveiled its first tokenized fund. Ethereum, the network behind the second-largest cryptocurrency by market capitalization, is the platform upon which its USD Institutional Digital Liquidity Fund operates.
One article from Tuesday by Bernstein’s Gautam Chhugani and Mahika Sapra noted that BlackRock’s most recent action “brings respectability” to Ethereum.
The reason for this is because blockchains like Ethereum have “thus far solely viewed as retail casinos,” according to the paper. “The infrastructure developed for retail speculation finally finds a way to power institutional utilities.”
“More conventional institutional clients to use on-chain funds,” the research said, citing BlackRock’s decision.
BlackRock plans to provide its customers with tokenized assets on the Ethereum blockchain so that they may receive income only by owning such tokens.
A spot Ethereum exchange-traded fund (ETF) is one of the “stepping stones towards tokenization,” according to BlackRock CEO Larry Fink, who has previously discussed the prospects of digital assets. The investment giant is now aiming to get permission for this ETF.
When BlackRock applied to the SEC to start a spot Bitcoin ETF last year, it sent shockwaves across the cryptocurrency community. After receiving approval in January, that ETF has gone on to achieve phenomenal success.
The company is now planning to launch an Ethereum product, giving its clients the opportunity to invest in the cryptocurrency via a stock exchange-traded fund. Ethereum now has a market valuation of $427 billion.
Even while the SEC has been slow to make a judgment on the proposed product, many other large fund managers, including Grayscale and Fidelity, are still seeking to get clearance for a spot Ethereum ETF.
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