BlackRock, a global asset management powerhouse overseeing assets exceeding $8 trillion, has ventured into the Bitcoin mining sector, making strategic investments in four of the five largest Bitcoin mining companies by market capitalization.
This bold move by BlackRock, renowned for its traditional financial expertise, showcases its growing interest in the world of digital assets. The data, as reported by CNN, reveals that BlackRock stands as the second-largest investor in four of the five leading Bitcoin miners by market cap. These miners collectively hold a market cap valued at around $5.4 billion.
Notably, these top Bitcoin mining companies have experienced substantial losses over the past month, possibly enticing BlackRock to seize the opportunity and acquire shares in these prominent players at lower prices.
BlackRock’s investments in these Bitcoin mining companies are as follows:
- Riot Platforms Inc. (NASDAQ: RIOT) – 10,749,369 shares (6.14%), valued at $199.08 million.
- Marathon Digital Holdings Inc (NASDAQ: MARA) – 10,938,032 shares (6.44%), valued at $190 million.
- Cipher Mining Inc (NASDAQ: CIFR) – 2,200,654 shares (0.88%), valued at $8.36 million.
- Terawulf Inc (NASDAQ: WULF) – 4,831,312 shares (2.28%), valued at $14.10 million.
BlackRock’s move into Bitcoin mining comes at a time when the industry is facing significant challenges. Increasing mining difficulty and rising operational costs have impacted profitability, with many miners operating at a loss for an extended period.
However, the involvement of major financial institutions like BlackRock provides a glimmer of hope for struggling miners. BlackRock’s significant financial resources allow it to support and potentially revitalize these mining companies.
The total value of BlackRock’s investments in these four firms amounts to approximately $411 million, a fraction of its vast assets under management. Additionally, BlackRock’s growing shareholding in these companies positions BlackRock Funds Advisors as an influential member of the Bitcoin Mining Council, a collective advocacy group for Bitcoin mining in the United States.
In addition to its investments in Bitcoin miners, BlackRock made headlines when it applied for a Bitcoin spot exchange-traded fund (ETF) earlier this year. This move is part of the company’s broader strategy to expand its presence in the digital asset space, including launching a Europe-focused ETF in September 2022.
BlackRock faced regulatory challenges with its ETF application but addressed concerns raised by the U.S. Securities and Exchange Commission (SEC) through revisions, including naming Coinbase as the surveillance partner. This highlights BlackRock’s determination to navigate the evolving landscape of cryptocurrency investments and offerings.