Larry Fink, chief executive of the world’s largest asset management firm, BlackRock, believes that tokenization of asset classes such as stocks and bonds could drive financial market efficiency and improve access for people. investors.
The CEO noted in its latest annual letter to investors, BlackRock is currently exploring the digital asset sector and will continue to do so, particularly in areas related to permissioned blockchains and the tokenization of stocks and bonds.
BlackRock will explore tokenized stocks and bonds
In the letter, Fink opined that the operational potential in the digital asset space goes beyond Bitcoin. The CEO revealed that fascinating developments are taking place in the fledgling industry beyond the hype and obsession with cryptocurrencies.
Despite the failure from major crypto entities like FTX, digital payments are advancing rapidly. Fink thinks innovative applications for the asset management industry could emerge in the digital space grows up.
“For the asset management industry, we believe the operational potential of some of the underlying technologies in the digital asset space could have exciting applications. In particular, the tokenization of asset classes offers the prospect of increasing the efficiency of capital markets, shortening value chains, and improving costs and access for investors,” he said. declared.
US lags behind in innovation: Fink
The BlackRock CEO also spoke about emerging markets like Brazil, India and parts of Africa that are seeing progress in payment systems and financial inclusion. In contrast, he argued that developed markets like the United States lag behind in payment innovation.
“In many emerging markets – such as India, Brazil and parts of Africa – we are seeing dramatic progress in digital payments, reducing costs and advancing financial inclusion. In contrast, many developed markets, including the United States, lag behind in innovation, which leaves the cost of payments much higher,” Fink said.
The past few weeks have seen US authorities crack down on crypto entities. Regulations issues with stablecoin issuing company Paxos at the abrupt closing from the crypto-friendly Signature Bank, US regulators have stepped up their oversight of the digital asset industry.
But Fink thinks the digital asset space needs finer regulation as the industry matures. He suggested that clear rules would help investors be aware of the risks associated with the sector.
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