BlackRock CEO Larry Fink said investors are turning to gold and cryptocurrency out of fear that their assets are losing value amid growing concerns over global financial stability.
“Owning crypto assets or gold are assets of fear,” BlackRock CEO Larry Fink said at the Future Investment Initiative (FII) conference in Saudi Arabia, according to a livestream by DWS News.
“You own these assets because you’re frightened of the debasement of your assets,” the Fink said, adding that investors are worried about the financial and physical security of their assets.
Fink’s comments came after gold took another slide on Monday, with spot prices tumbling below $4,000 after touching all-time highs above $4,377 around a week ago, according to TradingView data.
The need for dollar sales is the “biggest issue”
Addressing key concerns in the US economy, BlackRock’s Fink said that his biggest concern is the US dependency on selling dollars to international investors.
“We still are a nation that needs 30% to 35% of all our Treasury sales going overseas, and, to me, that’s the biggest issue today,” Fink said at a panel at FII.
“If that ever changed, it has a multiplier effect because of the dependency on selling dollar-based assets to foreigners,” he added, urging the need to unlock private capital.
At the event, BlackRock’s Fink also addressed the biggest concerns of global central banks, which have increasingly been hoarding gold, marking a major emerging shift in global finance this year.
Central banks’ biggest question
“I would say the biggest question from central banks is what role tokenization and digitization will play,” Fink said, referring to the many challenges central bankers worldwide face in navigating the emerging tokenization industry.
He highlighted some of the pressing questions, such as how quickly central banks should digitize their own currencies, the implications for the US dollar, and the impact on payment systems, among others.
“I think we spend so much time talking about AI. We’re not spending enough time talking about how quickly we’re going to tokenize every financial asset,” the BlackRock CEO said, adding:
“And I think that’s going to happen worldwide very rapidly. And I think most countries are ill prepared for that and under-appreciate how technology is changing that.”
Fink’s latest insights on the role of tokenization, as well as on assets such as crypto and gold, align with his long-standing view that all traditional financial assets would likely be tokenized over the coming decades.
Related: Bitcoin is no inflation hedge but thrives when the dollar wobbles: NYDIG
Apart from being the world’s largest investment company, BlackRock is also among the largest holders of Bitcoin (BTC), though solely on behalf of its clients.
As of Oct. 27, BlackRock’s iShares Bitcoin Trust fund held 805,806 BTC — about 26% more than the entire BTC holdings by Strategy, the world’s largest public holder of Bitcoin.
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