Bitcoin Is Getting a Big Boost Today From an Investor Who Called Cryptocurrencies ‘An Index of Money Laundering’

July 17, 2018, 9:03 AM UTC

Bitcoin is rising again, up by more than 5% in the last day. Other cryptocurrencies are also doing well, and this time the reason appears to come from an unlikely source: BlackRock (BLK), the asset manager whose chairman and CEO, Larry Fink, said earlier this year that cryptocurrencies are “more an index of money laundering” than anything else.

On Monday, a Financial News report claimed that BlackRock had established a working group to look into cryptocurrencies and blockchain infrastructure. Fink then confirmed the news, albeit with a major proviso: “I don’t believe any client has sought out crypto exposure,” he told Bloomberg.

BlackRock has since clarified that the group has been around for a few years, even though its existence was not previously publicly disclosed.

“Like most financial institutions, BlackRock has had a working group since 2015 that meets periodically to exchange information on blockchain and consists of employees from various parts of the business,” the company said. “We have been looking at blockchain technology for several years, recognizing potential for shared processes and data across market participants, clearing, settlement and reconciliation and simplified securities issuance.”

Even with the age of the group and Fink’s note of caution, some see BlackRock’s newly-reported exploration of the technology as hugely significant.

“As the largest asset manager in the world, its interest in crypto assets could be a catalyst for upward price movement and encourage other asset managers, even with more conservative strategies, to seriously explore investing in the crypto space,” Chris Yoo, a portfolio manager at cryptocurrency hedge fund Black Square Capital Management, told Reuters.

The news immediately triggered a 4.5% rise in Bitcoin’s value within two hours, according to a Coindesk report.

At the moment, the price of one Bitcoin stands at $6,738, up 5.25% over the last 24 hours. A few weeks ago it hit a 2018 low of $5,787, so it’s not doing badly by current standards, although the cryptocurrency was obviously doing a lot better when it almost hit $20,000 back in December.

Other cryptocurrencies are also having a good day: Ethereum is up 4.6%, XRP 6.6%, Bitcoin Cash 9% and EOS 7.8%.

This article has been updated to clarify that BlackRock has had the newly-reported working group since 2015.