The United States has been the center of attention recently for its economic conditions as well as foreign relations. The worsening situation with China now seems to have become so intolerable that the authorities are going after companies in their own country, with BlackRock being the most prominent example.
The world’s biggest asset management firm, BlackRock, along with index provider MSCI, is set to be investigated by US authorities. According to the House of Representatives Select Committee on the Chinese Communist Party, both companies have been investing in Chinese firms that are blacklisted by the US.
These Chinese companies have been associated with advancing the military prowess of the Asian country, and according to the Select Committee, BlackRock and MSCI were fueling this advancement.
The American capital flowing into these organizations would, in turn, prove to be dangerous to national security, is the concern raised by the Select Committee. However, BlackRock denied any wrongdoing stating,
“Like many global asset managers, BlackRock offers our clients a number of strategies to invest in or exclude China from their portfolios. The majority of our clients’ investments in China are through index funds, and we are one of 16 asset managers currently offering US index funds investing in Chinese companies.
The company went out to state that all investments in China, similar to any other country, are in compliance with all applicable US government laws.
China and USA are two of the biggest economies in the world, and an economic dispute could prove to be harmful to both nations. Reiterating the same, a spokesperson from China’s embassy in a statement to Reuters said,
“Overstretching the concept of national security and politicizing economic, trade and investment issues runs counter to the principles of market economy and international trade rules.
The deepening dispute has intensified the dedollarisation in the East and Asian countries, which has opened up opportunities for alternative currencies such as crypto to further their dominance. This advancement is reflected in America, with BlackRock being one of the many companies to file for spot Bitcoin ETF recently.
The Securities and Exchange Commission, after some initial dissension, accepted the ETF flings, adding them to the regulator’s dockets.
Read more – COIN price shoots up by 10% as BlackRock and CBOE refile Bitcoin ETFs, partnering with Coinbase
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