BlackRock is increasing its control over the Bitcoin and Ethereum markets through ETFs and investing in Strategy, raising concerns about the cryptocurrency market being taken over by Wall Street.
BlackRock's significant influence in the cryptocurrency market raises concerns in the community about price manipulation risks and the transformation of the Bitcoin ecosystem from a decentralized model to a centralized financial asset controlled by large organizations.
MAIN CONTENT
BlackRock holds strong dominance over Bitcoin and Ethereum ETFs, raising concerns about the manipulation of the cryptocurrency market.
Owning 5% of Strategy's shares allows BlackRock to further control the largest corporate Bitcoin reserves.
The risk of Bitcoin's decentralized foundation being undermined as power concentrates in the hands of Wall Street giants.
What makes BlackRock stand out in the Bitcoin and Ethereum ETF market?
BlackRock has elevated its influence on Wall Street as Ethereum ETFs record record capital flows, while Bitcoin ETFs achieve ATH in assets under management, solidifying this group's pioneering position in the institutional cryptocurrency market.
BlackRock has demonstrated its ability to shape the flow of cryptocurrency ETFs, profoundly impacting Bitcoin and Ethereum price movements globally.
CoinShares, Digital Asset Market Fund Flow Report Week 08/2024
Specifically, on August 11, Ethereum ETFs attracted a net inflow of $1.019 billion, with BlackRock's iShares Ethereum Trust (ETHA) exceeding $10 billion in assets under management. Meanwhile, iShares Bitcoin Trust (IBIT) reached $91.06 billion AUM as Bitcoin hit a new peak at $124,500.
This event shows that BlackRock not only holds but also controls the trend of Bitcoin capital flow. Through ETFs, BlackRock manipulates large cash flows in the cryptocurrency market, directly impacting prices and investor sentiment.
What is BlackRock's goal behind acquiring a stake in Strategy?
BlackRock unexpectedly purchased 5% of Strategy's shares (formerly MicroStrategy), marking an important strategic shift to seize the largest corporate Bitcoin reserve.
If BlackRock pressures MSTR stock, Bruce will have to sell Bitcoin when the stock price drops sharply, creating a serious domino effect.
Skynet Insights, excerpt from Twitter X report, 08/2024
Strategy stands out with its Bitcoin accumulation strategy through bond and stock issuance. However, this model makes the company vulnerable if stock prices drop sharply. BlackRock understands this weakness and is fully capable of manipulating the market through MSTR stock, pushing Michael Saylor to sell Bitcoin reserves when the price moves unfavorably.
If this scenario occurs, BlackRock could 'buy the dip' of the Bitcoin recently sold, increasing its control over Bitcoin supply from both the direct market and corporate reserves. This is the basis for many analysts' concerns about a potential future cryptocurrency monopoly.
What to do if Strategy has to sell Bitcoin?
In June 2024, Strategy transferred 7,382 Bitcoin (equivalent to approximately 850 million USD) to Coinbase Prime. This is seen as a preparation sign for potential liquidation, contrary to the typical long-term holding behavior.
The transfer of large amounts of Bitcoin to exchanges by institutions is a significant signal to monitor, as it may lead to substantial price fluctuations and market sentiment changes.
Glassnode, On-Chain Data Report 2024
During this same period, BlackRock sold over $500 million in Bitcoin in just 48 hours. Given BlackRock's scale, this amount is insignificant in absolute value but holds great strategic significance, marking the beginning of a broader market 're-establishment' cycle.
If BlackRock triggers a domino effect, the market could witness Bitcoin's price plummet to $65,000–$60,000, Ethereum to $1,700, while Altcoins lose 80–90% of their value. The derivatives market will experience significant volatility, exchanges may freeze, while small investors panic sell, which is when BlackRock and other institutions secretly buy in.
How much can BlackRock manipulate the Bitcoin market?
BlackRock's control over cash flow through IBIT ETFs while expanding influence over Strategy creates the risk of a single entity dominating both the actual supply and the largest corporate Bitcoin reserves.
When an organization holds up to 70% of the Bitcoin supply in the market, the decentralization principle—the core of cryptocurrency—risks being eliminated.
Blockchain Transparency Research Report, 2024
This scenario leads to a monopoly model, violating Bitcoin's original philosophy of empowering community ownership. Owning over 70% of the supply also means controlling liquidity, voting rights, and influencing all price dynamics in the market.
If this occurs, the entire cryptocurrency industry could shift from a decentralized foundation to a centralized one, depending on the strategies of Wall Street institutions like BlackRock, increasing risks and limiting the financial transparency that cryptocurrencies aim for.
The first sign of change: Strategy's stock price drop
The stock price of Strategy has just dropped to $366.32, down 1.78% in the past 24 hours. This highlights the imbalance and potential danger when a large organization holds dual power over both corporate shares and ETF products.
The correlation between stock price volatility and corporate Bitcoin volume shows that just one 'bottleneck' can cause Bitcoin's value ecosystem to plummet, regardless of the efforts of the founders or the Strategy team to maintain operations.
The event of falling stock prices is also a catalyst for BlackRock to seize the opportunity, consolidating its monopoly position over the corporate Bitcoin supply, triggering a series of negative effects if necessary.
If power becomes centralized, what will be the future of Bitcoin?
For BlackRock, the goal is not simply to surf for profits. They are building a long-term accumulation strategy, reinforcing their dominance and reshaping the rules of the game in the global Bitcoin market.
The Bitcoin market is facing a fragile boundary between community autonomy and being transformed into a Wall Street financial tool, weighed against gold or oil.
Chainalysis, Cryptocurrency Market Trends Report, 06/2024
If the monopoly scenario becomes a reality, Bitcoin risks losing its status as a decentralized community asset, instead becoming a centralized financial tool used for collateral and leveraged trading like traditional assets.
When giants like BlackRock 'distort' the market, individual investor communities will be at a disadvantage, the transparency value and control of Bitcoin assets—which is the most compelling reason for cryptocurrency—will be severely challenged. Instead of representing financial freedom, Bitcoin may become a tool for the interests of Wall Street corporations.
Frequently Asked Questions
How does BlackRock dominate the cryptocurrency market through ETFs?
BlackRock controls a large amount of Bitcoin and Ethereum through major ETFs like IBIT and ETHA, affecting capital flows, pricing, and market sentiment, based on evidence from CoinShares' fund flow report.
How does owning a stake in Strategy allow BlackRock to manipulate?
Owning 5% of Strategy gives BlackRock influence over both the corporate Bitcoin supply and the market, increasing the risk of volatility when Strategy needs to sell Bitcoin reserves.
What are the risks if a large organization owns too much Bitcoin?
If an organization controls over 70% of Bitcoin's supply, decentralization principles are violated, the market experiences significant volatility, and transparency values may erode.
How to recognize if a large organization is preparing to sell Bitcoin?
An important sign is transferring large amounts of Bitcoin to exchanges or withdrawing assets from cold wallets, according to Glassnode and on-chain studies.
How will Bitcoin's price fluctuate if a major sell-off occurs?
Predictions suggest Bitcoin's price could plummet to $65,000–$60,000, Ethereum to $1,700, and Altcoins could lose 80–90% of their value, along with a domino effect across the entire industry.
How does BlackRock's ETF impact the Altcoin market?
When Bitcoin and Ethereum experience significant volatility due to ETFs, capital will sharply withdraw from Altcoins, causing these coins to suffer substantial losses in value.
What to do to protect your portfolio when large manipulations occur?
Experts recommend diversifying portfolios, carefully examining capital flows from large organizations, and managing risks cautiously based on sources from CoinShares and Glassnode.
Source: https://tintucbitcoin.com/microstrategy-lieu-gap-rui-ro-voi-blackrock/
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