BlackRock "China may reduce US Treasury holdings and increase allocation to gold and Bitcoin (BTC)"

Minseung Kang

Summary

BlackRock predicts that China will reduce its US Treasury holdings and diversify its assets into gold and Bitcoin.
China is re-evaluating its reserve asset strategy in response to asset freeze risks and is likely to lead this trend.
The demand for non-traditional assets is inevitable in a geopolitical fragmentation scenario, and there are reports of surging inflows into gold and Bitcoin.

Global asset management firm BlackRock predicts that China is likely to continue reducing its US Treasury holdings and diversify its assets into gold and Bitcoin (BTC).

According to cryptocurrency-focused media outlet Cointelegraph on the 25th, Jay Jacobs, head of BlackRock's ETF strategy, stated in a CNBC interview, "Central banks, including China, may reduce their holdings of US Treasuries and turn to non-traditional assets like gold and Bitcoin."

Jay added, "Since $300 billion of Russia's foreign reserves were frozen due to the (Ukraine invasion), countries concerned about asset freeze risks are re-evaluating their reserve asset strategies," adding, "China is likely to lead this trend."

There are also observations that inflows into gold ETFs and Bitcoin have surged recently. He emphasized, "BlackRock identifies 'geopolitical fragmentation' as one of the most powerful trends that will drive global markets for decades to come," adding, "In such an environment, demand for assets with low correlation, like Bitcoin and gold, is bound to increase."

BTC