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BlackRock, which will take part in the Bitcoin mining field, also brings the ESG evaluation perspective to the agenda with this new move. According to the statements made by Bloomberg Intelligence’s crypto analyst Jamie Coutts, BlackRock is preparing to take on an important role in the Bitcoin mining industry. This move may come as a surprise to many, given BlackRock’s position in the traditional finance world.
Not an Unexpected Move
However, Coutts notes that BlackRock’s entry into this space is not entirely unexpected. The asset management giant took a step in this field about three years ago by investing in one of the leading publicly traded mining companies such as Marathon Digital. This initiative comes at a time when the crypto mining industry has received criticism for its heavy dependence on fossil fuels.
2022 has been challenging for miners, but companies like BlackRock, Vanguard, and State Street have continued to increase their stakes in publicly traded mining companies to protect and demonstrate their commitment to the industry.
ESG Perspective and Bitcoin
This could have a significant impact on asset managers’ ESG (Environmental, Social and Governance) credentials. According to recent analysis, more than half of Bitcoin mining energy comes from sustainable sources, which gives hope for sustainability.
As Bitcoin’s environmental impacts become more accepted, ESG-focused institutional investors may view this asset class more favorably. The specific role of Bitcoin’s ESG features in these investments is not yet clear, but it is estimated that detailed ESG reviews have been conducted. However, the interest of these large asset managers in Bitcoin mining may also introduce conflicts of interest that could potentially conflict with the core values of the network.