tl;dr
Amid concerns about inflation and privileged information sharing, BlackRock, a prominent asset management firm, has shifted its focus to Bitcoin as a hedge. Communication records revealed that a BLS economist shared detailed insights on US inflation with top Wall Street firms, including BlackRock. T...
Amid concerns about inflation and privileged information sharing, BlackRock, a prominent asset management firm, has shifted its focus to Bitcoin as a hedge. Communication records revealed that a Bureau of Labor Statistics (BLS) economist shared detailed insights on US inflation with top Wall Street firms, including BlackRock. This revelation, coupled with the International Monetary Fund's caution about US fiscal deficits stoking inflation, has driven BlackRock's bullish stance on Bitcoin.
The firm's iShares Bitcoin Trust (IBIT) has seen significant growth, accumulating over $15.3 billion, despite recent cooling interest in spot Bitcoin ETFs. In the wake of these disclosures, BlackRock has been particularly proactive with its bullish stance on Bitcoin. The cryptocurrency's limited supply and decentralization make it appealing as an inflation hedge. Following the International Monetary Fund's recent caution about US fiscal deficits, which they claim are stoking inflation and posing global risks, this strategy gains importance. BlackRock's CEO, Larry Fink, recently shared his positive outlook on Bitcoin.
This optimistic view is reflected in the performance of BlackRock's iShares Bitcoin Trust (IBIT), which accumulated over $15.3 billion, marking it as the fastest-growing Bitcoin ETF. However, this week, the interest in spot Bitcoin ETF seems to be cooling down. Specifically, IBIT received just $117.3 million in inflows in the past three days. Despite a slowdown, with a record low inflow of $18.1 million this Wednesday since its January 2024 inception, the ETF's success signifies a shift in investor preferences amid financial uncertainty.
BLACKROCK RECEIVED INFLATION DATA IN ADVANCE
Bloomberg obtained records showing frequent communications from the BLS economist about US inflation, specifically within the shelter and used cars categories of the consumer price index (CPI). These exchanges reveal that the economist gave detailed insights to a select group he called "my super users." The discovery of these communications has sparked investigations into their potential impact on asset trading and Federal Reserve policies. In response, Emily Liddel, BLS Associate Commissioner for Publications and Special Studies, emphasized the agency's commitment to fairness.
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