BlackRock Secures FCA Approval to Expand Crypto Offerings in UK

BlackRock, the world’s largest asset manager with approximately $12 trillion in assets under management, has secured registration from the UK Financial Conduct Authority (FCA) as a crypto asset firm. This approval allows BlackRock to expand its crypto offerings in the UK, including custody solutions and new investment products. The FCA’s stringent compliance process has made it notoriously selective, approving only a small percentage of applications, which underscores the significance of BlackRock’s achievement.

With this regulatory approval, BlackRock can now operate its recently launched European Bitcoin exchange-traded product (ETP) as a UK entity. The iShares Bitcoin ETP (IB1T), launched on the Euronext exchanges in Paris and Amsterdam, provides a regulated and lower-cost avenue for investors to gain exposure to Bitcoin. Initially, the ETP was offered at a reduced fee of 0.15% until the end of 2024, after which it will revert to 0.25%, aligning with similar products. Each share of IB1T is backed by real Bitcoin held by custodian Coinbase, adding an extra layer of security and trust for investors.

BlackRock’s move into the UK crypto market comes at a time of surging global demand for Bitcoin investment products, particularly outside of North America. The appeal of Bitcoin as both a store of value and a speculative asset has attracted more institutional investors seeking regulated and secure investment avenues. This trend is in line with the views of BlackRock CEO Larry Fink, who has highlighted Bitcoin’s potential as a store of value amidst the current US government debt crisis. As traditional financial institutions increasingly enter the crypto ecosystem, BlackRock’s expansion into Europe positions it to capitalize on the growing institutional interest in regulated and transparent crypto investment offerings.

The FCA’s approval of BlackRock is a testament to the firm’s credibility and compliance with regulatory standards. The FCA has maintained stringent policies, refusing many applications that do not meet sufficient information or compliance standards. However, the FCA has also shown a willingness to adapt its regulations as the market matures, ensuring that only the most credible players operate in the UK crypto space. BlackRock’s FCA approval is particularly noteworthy due to its significance in the broader context of the digital asset market.