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Former Barclays boss weighs in on TradFi’s crypto coup

Published 22/06/2023, 10:35 pm
© Reuters.  Former Barclays boss weighs in on TradFi’s crypto coup
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Bob Diamond, former Barclays PLC (LSE:LON:BARC) chief and part of traditional finance’s old guard, took to CNBC’s Squark Box on Wednesday to give his take on the recent insurgence into the cryptocurrency sector by some of the world’s largest financial institutions.

Asked if he was surprised to see the likes of BlackRock Inc (NYSE:NYSE:BLK), Citadel and Charles Schwab (NYSE:NYSE:SCHW) muzzling in on the underregulated and over-scrutinised decentralised economy, Diamond was as straightforward as it comes.

“Nope,” he said, calling crypto a “natural course” of “so much of what we’re doing”.

Though Diamond is best known as the former head of Britain’s third-largest bank (and for resigning in 2012 following the multibillion-dollar Libor scandal), his business interests have gravitated towards crypto in recent years.

Diamond’s US-based special purpose acquisition vehicle (SPAC) Concord Acquisition Corp had initially planned to combine with stablecoin issuer Circle (developer of the US$28bn USDC stablecoin), though those plans have since been scrapped.

Regardless, he still appears bullish on crypto.

“I love seeing some of the more mainstream firms get involved here,” said Diamond, specifically pointing out BlackRock.

Big Money bullish on bitcoin

BlackRock, the world’s largest asset manager with US$10tn under its umbrella, recently filed for a spot bitcoin ETF with the US Securities and Exchange Commission.

The SEC has yet to comment on BlackRock’s ETF ambitions, but giving the thumbs up would come as a massive shock to the incumbent cryptocurrency industry.

Should the SEC approve BlackRock’s application, it would be the first bitcoin spot ETF to ever be approved in the US, following years of rejecting similar applications made by crypto fund Grayscale.

Alongside BlackRock, asset managers Invesco, WisdomTree and even Fidelity are reportedly weighing up their own bitcoin spot ETF applications.

BlackRock’s bitcoin ETF filing came just prior to another major institutional finance encroachment into the crypto markets in the form of EDX Markets.

Backed by multinational big-hitters Fidelity, Charles Schwab (NYSE:SCHW) and Citadel Securities, EDX is a newly launched cryptocurrency exchange designed to play ball with the regulators.

Regulatory compliance is proving to be the secret ingredient behind TradFi’s crypto coup, something Diamond reckons is fundamental for the future of crypto.

“For any positive impact of crypto or digitisation, we need regulation and we need clarity… Stop avoiding it regulators and start regulating it,” was his prescription.

Unfortunately for Diamond, his bullishness didn’t come earlier. Asked if he’s ever bought bitcoin in the past, Diamond said he “sadly” had not.

Read more on Proactive Investors AU

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