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Coinbase shares rise nearly 44% in a single day on striking a deal with BlackRock

The bull run on Coinbase led the shares to skyrocket by a whopping nearly 44% in a single day as investors gave thumbs up to the BlackRock deal. (REUTERS)Premium
The bull run on Coinbase led the shares to skyrocket by a whopping nearly 44% in a single day as investors gave thumbs up to the BlackRock deal. (REUTERS)

  • Under the agreement, top clients of BlackRock will be able to use its Aladdin investment-management system to supervise their exposure to Bitcoin along with other portfolio assets including bonds and stocks.

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US-based largest cryptocurrency exchange, Coinbase rallied on Thursday after inking a deal with investment management corporation, BlackRock Inc. The bull run on Coinbase led the shares to skyrocket by a whopping nearly 44% in a single day as investors gave thumbs up to the BlackRock deal. Under the agreement, top clients of BlackRock will be able to use its Aladdin investment-management system to supervise their exposure to Bitcoin along with other portfolio assets including bonds and stocks.

On Nasdaq, at around 1.32 PM ET, Coinbase was trading at $92.9896 higher by 15.07%. However, the shares have touched an intraday high of $116.30.

On the previous day, the shares were around $80.81 on Nasdaq.

Taking into consideration the latest day's high, Coinbase shares have jumped by 43.92% from Wednesday.

According to BlackRock, the company's top clients will be able to use its Aladdin investment-management system to oversee their exposure to Bitcoin along with other portfolio assets such as stocks and bonds, and to facilitate financing and trading on Coinbase’s exchange, as reported by Bloomberg.

It said that the focus of the partnership will initially be on Bitcoin which is the largest cryptocurrency in terms of market valuation.

Joseph Chalom, BlackRock’s global head of strategic ecosystem partnerships stated that their institutional clients are increasingly interested in gaining exposure to digital-asset markets. Further, they are focused on how to efficiently manage the operational life cycle of these assets.

Oppenheimer & Co. analyst Owen Lau has given a buy rating on Coinbase shares.

Lau in a phone interview with Bloomberg said that the regulatory risks from the partnership are manageable because it’s starting with Bitcoin, which has clearer regulatory status in Washington than other digital assets.

Further, Lau added that the tie-up is a validation of the future of blockchain and digital assets and also a validation of Coinbase’s reputation. Adding Lau mentioned that the deal is a "big plus for the industry and also for Coinbase."

Data disclosed by Coinbase in May, revealed that institutional investors accounted for about three-quarters of $309 billion in trading volume on their platform.

On CoinMarketCap, Bitcoin is currently trading at $22,609.52 down by 3.82%. The cryptocurrency's market valuation is around $431.85 billion.

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