According to the crypto firm Circle Internet Financial, the company is “deepening” its partnership with the world’s largest asset manager Blackrock. Circle disclosed that it has started to transfer USDC reserves into a Blackrock-managed fund that’s registered with the U.S. Securities and Exchange Commission (SEC).
Circle Deepens Relationship With the World’s Largest Asset Manager Blackrock
Mid-April 2022 Circle announced that Circle had entered into an investment agreement. The deal included Blackrock Inc. Fin Capital, Fidelity management and research, Marshall Wace LLP, Marshall Wace LLP, Blackrock Inc. and Fin Capital. The investment was a $400 million funding round and during the announcement, Blackrock explained how Circle and the New York-based multi-national investment company would expand the two companies’ existing relationship. It was also revealed that Blackrock would be used by Circle for “managing significant assets for the reserves that back USDC.”
On November 3, 2022 Circle announced that it would deepen its partnership with Blackrock. The company has begun to transfer USDC reserve funds into Blackrock-managed funds. “Through our partnership with Blackrock, we have begun investing in the Circle Reserve Fund to manage a portion of the USDC reserves,” Circle’s chief financial officer (CFO) Jeremy Fox-Green explained. Circle’s CFO also added:
Our expectation is that the remaining reserve components will remain approximately 20 percent cash and 80 percent short-duration U.S. Treasuries.
The investment objective of the Circle Reserve Fund (USDXX) is to “seek current income as is consistent with liquidity and stability of principal.” Circle is the only investor and the fund invests in “at least 99.5% of its total assets in cash, U.S. Treasury bills, notes, and other obligations.” According to Circle’s announcement, the company hopes to be fully transitioned by the end of March 2023.
Number of USDC Stablecoins in Circulation Slides Significantly, Circle’s EURC Token to Be Supported by Solana Next Year
Circle says the fund is held by Bank of New York Mellon as the financial institution has already been a custodian for USDC’s reserves that are comprised of U.S. Treasuries. Circle’s announcement on Nov. 3 follows the number of USDC in circulation decreasing rapidly during the last few months.
In mid-June Circle also announced that it had launched a stablecoin backed in euro called the euro coin (EURC). Marcus Boorstin, Circle’s director of engineering, announced this week at a Solana-centric conference that EURC would be minted on Solana next year.
What do you think about Circle’s blog post about deepening its relationship with the world’s largest asset manager Blackrock? Comment below and let us know how you feel about the subject.
Images CreditsShutterstock. Pixabay. Wiki commons. Editorial photo credit to Michael Vi / Shutterstock.com
DisclaimerThis information is provided for educational purposes only. This article is not intended to be a solicitation or offer to sell or buy any product, service, or company. Bitcoin.com doesn’t offer investment, tax or legal advice. The author and the company are not responsible for any loss or damage caused by the content or use of any goods, services, or information mentioned in the article.