BlackRock’s big Ethereum ETF play — smarter than anybody thinks Read the latest news on the booming ETFs market. Or is it simply a huge tsunami that will wash away all the small to mid-sized operators in Asia? Blockchain founders from Singapore to Seoul are abuzz with that question. Rich in tradition but a nation open to financial innovation, in the Philippines it rings truer.

Will This Help or Hinder Us?

Let's be real. BlackRock’s meeting with the SEC’s new Crypto Task Force is not about making things fair. It's about dominating it. Their commitment to making staking available across Ethereum ETFs would do wonders to benefit Western investors. At the same time, it presents a great difficulty in realizing the dreams of Asian startups.

Here's why: smaller Asian players often rely on agility, community building, and localized strategies to thrive. They drive innovation through other key approaches, like complex regulatory landscapes, or creating solutions tailored to their individual markets. Can they go toe to toe with BlackRock’s massive size, its lobbying muscle and, of course, its access to capital? I'm not so sure.

I had the chance to catch up with Josefa, one such budding blockchain entrepreneur in Manila who is working on a remittance platform leveraging stablecoins. Her concern isn’t with the tech at play, but with the regulatory vise she expects to see. "BlackRock talking to the SEC? That probably means costs of compliance going waaaaaay up. It's harder for us to keep up."

Big Players, Bigger Problems?

With BlackRock’s addition, the crypto space can feel a bit more legitimate. This increase encourages wider adoption and drives innovation. What kind of innovation? The kind that mainly enriches institutional investors and US shareholders, or the kind that helps individuals in emerging markets achieve their dreams?

Think about this: BlackRock's BUIDL platform, while technically impressive, is designed for institutional clients. Will it provide the same space for Asian startups to test and learn? Probably not. Or through rulemaking driven by BlackRock’s point of view, will the SEC issue rules that unintentionally solidify advantages for large, legacy players? The risk is definitely there.

One possible analogy? Consider the early days of the internet. It was the ultimate in being decentralized, open, and accessible to everyone. Over the years, power was increasingly concentrated with a few large tech companies. Are we seeing a trend across the crypto space too? BlackRock is continuing to emerge as Wall Street’s new progressive powerhouse.

The Philippine Paradox

The Philippines is a fascinating case study. Despite having one of the world’s largest rates of crypto adoption, the country’s regulatory framework is still a work in progress. The government is indeed looking at many different ways to approach cryptocurrency regulation. While BlackRock’s investments will probably help change the national government’s tune, they carry the threat of tighter regulations that would stifle local innovation.

  • Increased Capital Competition: Asian startups may face tougher competition for funding as investors flock to institutional-grade projects.
  • Regulatory Burdens: Smaller players could struggle to comply with complex regulations influenced by BlackRock's discussions with the SEC.
  • Shift in Focus: The industry might shift towards projects that cater to institutional demands, potentially neglecting the needs of the local market.

I’d suggest instead that we start asking who’s really missing out on all this. Is it going to be the lil’ Filipina worker paying remittance home to her family, or is it going to be BlackRock’s shareholders?

Here's the outrage: There's a real danger that BlackRock's push will create a two-tiered system, where institutional players thrive while smaller Asian startups struggle to survive.

Time To Speak Up!

This isn't about being anti-BlackRock. It’s an approach to making sure that the benefits of crypto innovation are more evenly distributed. Asian founders need to be active in shaping the future of crypto regulation. As such, they should exercise real legislative will to push for policies that spur local innovation.

We’re going to need a great deal more discourse and partnership between Asian startups and western investors and facilitators — such as BlackRock. If we’re serious about building an inclusive tech ecosystem, we have to make sure that the voices of Asian founders come through loud and clear. Additionally, we must be on guard in defending crypto’s decentralized nature from capture by traditional corporate players.

Support Asian blockchain startups. Invest in their projects. Amplify their voices. Demand transparency and accountability from regulators. We shouldn’t let BlackRock’s supertanker sink the dreams of Asia’s crypto trailblazers. The future of finance depends on it.