BlackRock Executive Points to Shift Away From Dollar-Based Reserves

BlackRock's head of thematics and active ETFs, Jay Jacobs, has revealed that central banks, particularly China, may be moving away from US Treasuries toward alternative assets such as gold and Bitcoin. This shift comes amid growing geopolitical tensions and global uncertainty, according to Jacobs' recent CNBC interview.

Jacobs noted that countries have been reducing their reliance on dollar-based reserves over the past few years. "This whole diversification away from traditional assets and into things like gold and also crypto probably began three, four years ago," he explained. Recent geopolitical events have accelerated this trend.

The freezing of $300 billion in Russian central bank assets following the Ukraine invasion has prompted countries like China to reconsider their reserve strategies. This action has heightened concerns about the security of traditional reserve holdings and boosted interest in alternatives.

BlackRock, the world's largest asset manager, has identified geopolitical fragmentation as a major force shaping global markets in coming decades. "We really identified geopolitical fragmentation as a mega force that is driving the world forward over the next several decades," Jacobs stated during the interview.

This environment has increased demand for uncorrelated assets, with Bitcoin increasingly viewed alongside gold as a safe-haven asset. "We've seen significant inflows into gold ETFs. We've seen significant inflows into Bitcoin. And this is all because people are looking for those assets that will behave differently," Jacobs added.

BlackRock's own iShares Bitcoin ETF (IBIT) recently won "Best New ETF" at the annual etf.com awards on April 23, the same day it recorded $643.2 million in inflows. The fund, launched in January 2024, now holds approximately $53.77 billion in assets and trades an average of 45.02 million shares daily.

Other analysts have also observed Bitcoin's declining correlation with US equities. Alex Svanevik, co-founder and CEO of Nansen crypto intelligence platform, noted on April 22 that Bitcoin's price pattern shows its growing maturity as a global asset, becoming "less Nasdaq — more gold." Bitcoin was "surprisingly resilient" during recent market fluctuations.

QCP Capital echoed this view in an April 21 Telegram note, stating that Bitcoin appeared to be sharing gold's role as a hedge against macroeconomic uncertainty. "Should this dynamic hold, it could provide a fresh tailwind for institutional BTC allocation," the firm wrote.