BlackRock To Challenge USDT And USDC’s Dominance With New Proposal

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As a seasoned researcher with a keen eye for financial trends and a penchant for the ever-evolving crypto market, I find BlackRock’s latest move to be both strategic and intriguing. Having closely followed the rise of Tether’s USDT and Circle’s USDC in the derivatives market, it’s fascinating to see a titan like BlackRock aiming to shake up this dominance with its BUIDL token.

BlackRock is planning to contest the supremacy of USDT and USDC by proposing that crypto exchanges use its BUIDL token as collateral for derivatives trading. This action is part of the global asset manager’s strategy to strengthen its position in the cryptocurrency market, given its existing substantial holdings of bitcoins via its Spot Bitcoin ETF.

BlackRock To Challenge USDT And USDC’s Dominance

BlackRock’s fresh plan aims to contest the supremacy of USDT and USDC within the realm of cryptocurrency derivatives. As per a Bloomberg article, the leading asset manager in conjunction with its brokerage associate, Securitize, are engaging in discussions with prominent crypto platforms such as Binance, OKX, and Deribit regarding the potential use of the BUIDL token as security for transactions on the derivatives market.

As a long-time participant in the cryptocurrency market, I have witnessed the rapid growth and evolution of stablecoins such as Tether’s USDT and Circle’s USDC. They have become essential tools for trading crypto derivatives, providing stability amidst the volatility that characterizes the cryptosphere. However, a recent move by an industry giant like BlackRock has caught my attention.

At present, institutional investors are primarily utilizing the token because brokerage firms specializing in cryptocurrencies, such as FalconX and Hidden Road, accept it as collateral from their clients, which include hedge funds. Consequently, listing BUIDL on platforms like Binance, the world’s largest crypto exchange, is expected to significantly increase the token’s usage.

As a researcher, I propose that integrating the BUIDL token into the cryptocurrency derivatives market could strategically enhance our company’s financial standing. Currently, this asset manager levies a 0.5% management fee on the BUIDL token. By doing so, we can potentially increase our revenue stream. Moreover, it’s crucial to note that the crypto derivatives market represents a significant portion of trading volume in the cryptocurrency industry, making this move tactically sound.

The Asset Manager’s Hold In The Crypto Space

BlackRock’s dominance in the cryptocurrency sector has strengthened since it introduced Spot Bitcoin ETFs. According to SoSoValue data, BlackRock manages a staggering $25.79 billion in assets for its Bitcoin ETF, making it the leader among all issuers in this category. This places the asset manager as the third largest holder of Bitcoin, trailing only behind Bitcoin’s creator, Satoshi Nakamoto, and Binance.

In recent periods, the asset management company has significantly increased its purchases. Notably, CoinGape stated that the firm’s IBIT Bitcoin ETF acquired 5,805 Bitcoins within a day. Remarkably, Bloomberg analyst Eric Balchunas anticipates that BlackRock will hold the most Bitcoins by the end of next year.

The asset manager is involved with the Ethereum network through its Spot Ethereum Exchange-Traded Fund, ETHA, and manages $1.12 billion in assets for this fund. This makes BlackRock the second largest Ethereum ETF provider, trailing behind Grayscale.

It’s noteworthy that BlackRock, in its exploration of the cryptocurrency realm, has ventured into Bitcoin mining. Specifically, they have made investments in American Bitcoin mining corporations, such as Marathon Digital and Riot Blockchain.

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2024-10-18 21:08