BlackRock, the world’s largest asset manager with $7.81 trillion under management, appears to have granted at least two of its funds the ability to invest in bitcoin futures.
Prospectus documents filed with the U.S. Securities and Exchange Commission Wednesday indicate that BlackRock Global Allocation Fund Inc. and BlackRock Funds V are at least eyeing bitcoin. They both include “bitcoin” on their list of derivative products cleared for use.
BlackRock did not state which commodity exchange it will choose to execute bitcoin futures buys. However, the funds may only invest in cash-settled bitcoin futures. CME is the only exchange registered with the Commodity Futures Trading Commission (CFTC) that offers cash-settled bitcoin futures at this time.
The filings warn that investments in bitcoin futures could carry illiquidity risks due to the “relatively new” market. Regulatory changes, volatility and valuation risks could similarly weigh on the price and thus “adversely impact a Fund.”
The filings appear to mark BlackRock’s entrance into the bitcoin market.
Before Wednesday, the investments giant has never so much as mentioned “bitcoin” in any of its regulatory filings. But that appears to be changing: “Certain Funds may engage in futures contracts based on bitcoin,” the prospectus documents state.
This is a developing story and will be updated.