BlackRock has boosted its share in Bitcoin-focused company Strategy, which has been reflected in the stock market. Meanwhile, the company is solidifying its status as the largest corporate holder of the cryptocurrency.
BlackRock's Investment in Strategy
According to a February 6 filing with the U.S. Securities and Exchange Commission, BlackRock has increased its stake in Strategy to 5%, up from 4.09% in September 2024. Following this disclosure, Strategy's stock rose 2.8% in pre-market trading, reaching $331.90 per share.
Strategy's Bitcoin Activity
Strategy remains the largest corporate holder of Bitcoin, possessing 471,107 BTC worth about $48 billion. Despite reporting a $670 million net loss in Q4 2024, the company continues to pursue its '21/21 Plan,' aiming to raise $42 billion for additional Bitcoin purchases. Thus far, it has secured $20 billion through debt and equity financing. The company recently rebranded as part of its strategy to strengthen its position as the world's largest Bitcoin treasury company.
BlackRock's Role in the Bitcoin World
BlackRock is preparing to launch its first Bitcoin exchange-traded product in Europe, following the success of its $58 billion Bitcoin ETF in the U.S. The fund is expected to be based in Switzerland, with marketing potentially starting soon. In January 2024, the firm launched the iShares Bitcoin Trust, making it the largest of its kind, amassing over $50 billion in assets. BlackRock CEO Larry Fink has shifted his stance towards Bitcoin, citing it as a hedge against currency devaluation and a valuable asset in investors' portfolios. The firm recommends a modest allocation of 1% to 2% in Bitcoin to capture diversification benefits.
BlackRock's increased share in the company Strategy and the preparation for the launch of a new Bitcoin product highlights the growing involvement of major financial institutions in the cryptocurrency world. This may indicate an increasing recognition of Bitcoin as a significant asset for portfolio diversification.
