BlackRock Silently Affirms a Sobering Bitcoin Value Revelation
BlackRock Silently Affirms a Sobering Bitcoin Value Revelation
Bitcoin has surged significantly this year, chiefly due to the involvement of BlackRock, the world's largest investment manager, who have invested a substantial $10 trillion, thereby causing a sense of 'fear of missing out' (FOMO) among Wall Street investors.
The price of Bitcoin has more than doubled since its summer lows, fueled by Donald Trump's U.S. election victory and Tesla billionaire Elon Musk's warnings about the potential collapse of the U.S. dollar.
Recently, Trump confirmed his plans for Bitcoin, and this was followed by BlackRock creating a stir in the Bitcoin community by releasing a video explaining Bitcoin, cautioning that there's no guarantee that its 21 million supply limit won't be altered in the future.
Interestingly, this video was shared by MicroStrategy's Michael Saylor. In the video, Bitcoin is described as having a limited supply of 21 million, a feature that controls its supply, purchasing power, and protects against the misuse of unlimited currency printing.
However, a disclaimer was added, stating that there's no guarantee that Bitcoin's 21 million supply limit won't be altered in the future. This disclosure has raised concerns among some in the Bitcoin community who argue that BlackRock's involvement with Bitcoin may eventually lead to it being manipulated.
Joel Valenzuela, business development lead for the decentralized autonomous organization (DAO) of the cryptocurrency dash, expressed his concerns on Twitter, suggesting that BlackRock's admission of the possibility of modifying Bitcoin's supply cap was a clever tactic to soften the blow when such an eventuality occurs in the future.
Bitcoin's supply is reserved for around 21 million, with the last coins not expected to be mined until around 2140. The number of Bitcoins that can be issued is a part of Bitcoin's code, and any changes to this would require a consensus among those who secure the Bitcoin network in exchange for newly minted Bitcoins, known as miners. If a majority of miners voted to increase Bitcoin's supply, the network would split, or 'fork,' with the minority continuing to direct their computing power towards the network capped at around 21 million Bitcoins.
BlackRock played a significant role in lobbying for a spot Bitcoin ETF in the U.S. last year, with these funds debuting in January. U.S. spot Bitcoin ETFs surpassed $100 billion in net assets for the first time in November, according to data from Bloomberg Intelligence, while BlackRock's iShares Bitcoin Trust (IBIT) now manages almost $60 billion in assets.
Earlier this year, JPMorgan's CEO, Jamie Dimon, a known Bitcoin critic, also expressed his belief that Bitcoin's supply could be altered in the future. "How do you know that it’s going to stop at 21 [million]?", Dimon questioned on the sidelines of the World Economic Forum (WEF) in Davos. "I've never met one person who told me that they know for a fact."
Larry Fink, the CEO of BlackRock, mentioned in the Bitcoin video that there's no absolute guarantee about Bitcoin's 21 million supply limit not being altered in the future. The Bitcoin price could potentially be affected if BlackRock decides to manipulate Bitcoin's supply, as suggested by Joel Valenzuela.