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BlackRock, the globally renowned asset management firm, has sounded the alarm on a significant rise in crypto-related scams targeting investors in its iShares spot Bitcoin and Ethereum ETFs (exchange-traded funds).
The company has issued a stern warning against social media impersonators who are exploiting these high-profile investment products to defraud unsuspecting investors.
Rising Threat of Social Media Scams
In a public alert released today, the asset management titan cautioned investors to steer clear of individuals or businesses falsely claiming to represent BlackRock. These scammers are primarily operating through social media platforms, baiting victims with offers of investment training or direct investment opportunities. The company’s statement emphasized:
“There has been a spike in investment-related scams, including directing users toward crypto investment-related websites and/or social media platforms such as WhatsApp or Telegram.”
There has been a spike in investment-related scams, including directing users toward crypto investment-related websites and/or social media platforms such as WhatsApp or Telegram. We urge caution in dealing with individuals, websites or social media platforms using our brand and… — BlackRock (@BlackRock) July 28, 2024
The surge in scam activities has seen fraudsters increasingly impersonating the firm’s representatives to lure investors into their schemes. These malicious actors often use platforms like WhatsApp and Telegram to engage with potential victims, promising lucrative returns on crypto investments or exclusive access to insider training.
BlackRock has made it clear that it never contacts investors through social media channels to solicit payments or offer investment opportunities. The firm strongly advises investors to remain vigilant and verify any unsolicited communications claiming to be from BlackRock or its affiliates.
Since its launch on Jan. 11, 2024, BlackRock’s iShares Bitcoin Trust (IBIT) has attracted substantial interest, amassing an impressive $19.7 billion in Bitcoin investments. This influx positions IBIT as the leading Bitcoin ETF in the market, surpassing the combined assets under management of the other nine U.S.-approved spot Bitcoin ETF providers.
The popularity of BlackRock’s Bitcoin ETF shows the growing mainstream acceptance of cryptocurrency investments. However, it also highlights the increased risk of scams, as fraudsters seek to capitalize on the product’s success and the trust investors place in BlackRock’s brand.
Insights from the BlackRock Leadership
During the recent Bitcoin 2024 conference in Nashville, Tennessee, Robert Mitchnick, BlackRock’s head of digital assets, provided insights into the company’s stance on cryptocurrency investments. He noted that while there is significant interest in Bitcoin and Ethereum among BlackRock’s clients, there is limited enthusiasm for other cryptocurrencies.
“I would say that our client base today, their interest overwhelmingly is in Bitcoin first, and then somewhat in ETH… and there’s very little interest today beyond those two,” Mitchnick stated.
He also projected that investors might eventually allocate around 20% of their crypto portfolios to Ethereum, with the majority favoring Bitcoin.
Larry Fink’s Evolving Perspective on Bitcoin
Larry Fink, CEO of BlackRock, has undergone a notable shift in his views on Bitcoin. Once a skeptic, Fink now acknowledges Bitcoin as “digital gold” and a legitimate financial instrument. In a recent interview with CNBC’s Jim Cramer, he explained:
“It (Bitcoin) is a legitimate financial instrument that allows you to maybe have uncorrelated type of returns.”
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