BlackRock CEO Larry Fink said investors are turning to gold and cryptocurrencies for fear of a decline in asset values amid growing concerns about global financial stability.
“Owning crypto assets and gold are scary assets,” BlackRock CEO Larry Fink said at the Future Investment Initiative (FII) conference in Saudi Arabia, according to a DWS News livestream.
“People own these assets because they are afraid of depletion,” Fink said, adding that investors are concerned about the financial and physical security of their assets.
Fink’s comments came after gold fell further on Monday, with spot prices falling below $4,000 after hitting an all-time high of more than $4,377 about a week ago, according to TradingView data.
The need to sell dollars is the “biggest challenge”
BlackRock’s Fink cited major concerns about the U.S. economy, saying the biggest one is the U.S.’s reliance on foreign investors to sell dollars.
“We are still a country that needs to move 30-35% of its national debt sales overseas. To me, that’s the biggest issue today,” Fink said during an FII panel discussion.
“If this changes, there will be multiplier effects because we are dependent on selling dollar-based assets to foreigners,” he added, calling for the need to free up private capital.
At the event, BlackRock’s Fink also touched on the biggest concern of the world’s central banks, which are increasing their gold hoards, marking another major shift in global finance this year.
Central banks’ biggest questions
“I think the biggest question from central banks is what role tokenization and digitization will play,” Fink said, noting the many challenges central bankers around the world face in navigating the nascent tokenization industry.
He highlighted some of the pressing issues, including how quickly central banks should digitize their currencies, the impact on the US dollar, and the impact on payment systems.
“I think we spend far too much time talking about AI. We don’t spend enough time talking about how quickly we can tokenize every financial asset,” the BlackRock CEO said, adding:
“And I think that’s going to happen very quickly around the world. And I think most countries are underprepared for it and underestimate how technology is changing that.”
Fink’s latest insights into the role of tokenization, and not just assets such as cryptocurrencies and gold, are consistent with his long-held view that all traditional financial assets are likely to be tokenized in the coming decades.
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In addition to being the world’s largest investment firm, BlackRock is also one of the largest holders of Bitcoin (BTC), albeit only on behalf of its clients.
As of October 27, BlackRock’s iShares Bitcoin Trust Fund held 805,806 Bitcoins, approximately 26% more than the total Bitcoin holdings of Strategy, the world’s largest public Bitcoin holder.
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