On October 24th, the U.S. Securities and Exchange Commission (SEC) made allegations against BlackRock, the world’s largest asset management company. Specifically, the SEC accused BlackRock of misrepresenting its investments and providing inaccurate reports regarding returns from its investment in the Aviron Group, a film production company.
Between 2015 and 2019, BlackRock had a partnership with Aviron, sponsoring one to two films each year. However, the company’s reported returns from this investment were inflated and not truthful. Andrew Dean, Deputy Director of the SEC’s Asset Management Unit, emphasized the importance of accurately reporting investments. He noted that investors rely on these details to make informed decisions. BlackRock’s mistakes had deceived parties involved and violated the necessary trust in investment relationships.
In response to the allegations, BlackRock agreed to comply with all SEC penalties, including ceasing investment activities in Aviron and paying a $2.5 million fine. However, the company emphasized that agreeing to the penalty does not imply an admission of guilt.
In addition to the SEC’s allegations, on October 24th, the cryptocurrency market saw a surge when BlackRock’s iShares Bitcoin ETF (IBTC) was listed on the Depository Trust and Clearing Corporation (DTCC), a transaction settlement entity of NASDAQ. However, later that same day, this fund mysteriously disappeared from DTCC’s list, causing Bitcoin’s price to fluctuate, dropping by $1,000. Fortunately, a few hours later, iShares Bitcoin ETF reappeared on DTCC’s website.
It can be observed that cryptocurrency enthusiasts viewed this listing as a potential approval, boosting the market by nearly 20%. Therefore, the abrupt delisting left investors puzzled, causing a significant loss of optimism in the cryptocurrency field.