PANews reported on April 1 that according to Beincrypto, Larry Fink, CEO of BlackRock, claimed in a recent letter that Bitcoin and cryptocurrencies could undermine the international status of the US dollar. If investors view Bitcoin as a hedge against US dollar inflation, this could cause serious problems. However, he also insisted that the industry has many advantages, especially through tokenization.
Larry Fink said that the best interests of cryptocurrencies are not always aligned with traditional finance (TradFi) or the U.S. dollar. He said: "For decades, the United States has benefited from the dollar's status as the world's reserve currency. But this is not guaranteed to be the case forever. By 2030, the government's mandatory spending and debt repayments will exhaust all federal revenues, resulting in a permanent deficit. If the United States cannot control its debt... the United States may give up this status to digital assets such as Bitcoin."
To be clear, Fink insisted that he supports cryptocurrencies and listed a number of real problems he believes cryptocurrencies can solve. He showed a particular interest in asset tokenization, claiming that digital native infrastructure will improve and democratize the traditional financial ecosystem. Despite these advantages of cryptocurrencies, Fink also recognized that cryptocurrencies could be dangerous to the U.S. economy if not managed properly. He talked about the long-standing practice of using cryptocurrencies to hedge against inflation, which is a wise approach for many assets.
