After a year of major crypto exchanges collapsing only to reveal a scam behind them, the virtual asset's viability and credibility as an investment vehicle has taken multiple hits. Lawsuits against Coinbase and Binance for trading in unauthorized securities have also affected prospects for cryptocurrencies to become a serious instrument for investors.
But now, one of the world's largest asset management firms, Blackrock, has taken a bet on cryptocurrency by launching a Bitcoin Exchange Traded Fund.
Make cryptocurrencies credible again?
ETFs are pooled investment instruments, which will track the price of Bitcoin, and are guaranteed by Coinbase as custodian.
As cryptocurrency exchanges seek legitimacy and approvals from the US Securities and Exchange Commission, Blackrock backing them could be a positive development.
A major AMC entering the space also dismisses speculation that recent turmoil and accidents may have turned the public away from cryptocurrencies.
A first in the US
Through Blackrock's Bitcoin ETFs, investors will gain exposure to the leading cryptocurrency without buying anything from it.
The US regulator has not yet approved Blackrock's application, but if accepted, it will be the first time it has been filed in the US.
At a time when nearly 23,000 cryptocurrencies are available on the market, Blackrock's endorsement adds another layer of credibility to Bitcoin.
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