Bitcoin News Today: BlackRock's Crypto Stakes Rise Amid Fraud Fallout, Testing Market Trust

BlackRock Inc. deposited $225 million worth of Bitcoin and Ether into Coinbase's institutional platform, Coinbase Prime, signaling renewed institutional confidence in cryptocurrency markets amid a broader shift in digital asset strategies, according to ValueTheMarkets. The move, which includes 3,495 BTC and 31,754 ETH, aligns with Coinbase's recent emphasis on expanding its role as an "Everything Exchange," integrating custody, derivatives, and stablecoin infrastructure to capture a larger share of the crypto ecosystem, according to a PYMNTS report.

Coinbase's third-quarter financial results underscored its strategic pivot, with revenue up 55% year-on-year to $1.9 billion and a 34.3% rise in stablecoin-related subscription revenue to $746.7 million, as reported by TradingView. USDC, the stablecoin co-developed with Circle, hit a record $74 billion market cap, with Coinbase managing $15 billion in average balances. The platform also expanded its derivatives offerings through the $3 billion acquisition of Deribit, now a cornerstone of its institutional strategy, as PYMNTS noted.

The firm's Bitcoin holdings grew by 2,772 BTC in Q3, valued at $299 million, as part of a long-term accumulation plan, according to TradingView. This follows BlackRock's own crypto bets, including its $225 million deposit, which reflects a broader trend of institutional rebalancing. However, BlackRock's recent turmoil — a $500 million fraud uncovered in its HPS private credit division — has cast a shadow over its crypto initiatives. The scandal, involving telecom financing fraud, has triggered $490 million in outflows from its Bitcoin ETFs, including $291 million from the IBIT fund, according to BeInCrypto.

Coinbase's CEO, Brian Armstrong, emphasized the growing importance of stablecoins in payments, a sector the exchange is targeting through APIs and embedded wallets, as PYMNTS observed. Meanwhile, critics argue that BlackRock's crypto activities may be influenced by political connections, though Coinbase's chief policy officer dismissed such claims as "ridiculous," highlighting nonpartisan industry PAC contributions and standard inaugural donation practices, as reported by TradingView.

The interplay between institutional demand and regulatory scrutiny continues to shape the market. While Coinbase's Q3 profits exceeded Wall Street estimates, BlackRock's fraud has intensified calls for oversight in private credit and crypto-linked assets. For retail investors, these developments highlight the dual forces of innovation and risk in a rapidly evolving landscape.