BlackRock, the world's largest asset manager, has expressed that stablecoins could facilitate the strengthening of Bitcoin's position as a primary crypto asset.
Stablecoins and Dollar
BlackRock noted that the recent passage of stablecoin legislation in the U.S. solidifies the role of dollar-pegged tokens as "payment methods" in the U.S. The financial company believes that the GENIUS Act, regulating the stablecoin sector, can help support the dominance of the U.S. dollar.
BlackRock's Involvement in the Stablecoin Market
BlackRock has been active in the burgeoning stablecoin sector for a considerable time. In March 2024, the company launched a blockchain-based tokenized liquidity fund that invests in U.S. treasuries. Additionally, in 2022, BlackRock took a minority stake in Circle, the issuer of USDC, which went public earlier this year.
Future of Stablecoins
It is often expected that the rise in stablecoin issuance will exert upward pressure on demand for government bonds; however, BlackRock predicts that this growth will not significantly affect short-term yields. Investments will come from investors who already hold safe assets like short-term bond ETFs.
Thus, amid growing interest in stablecoins and their regulation, BlackRock sees them as an opportunity to support Bitcoin's position as an asset with potential for return diversification.
