BlackRock CEO Larry Fink has sharply shifted his stance on Bitcoin. He now sees the cryptocurrency's potential as a legitimate financial instrument. Fink cites its ability to provide uncorrelated returns and hedge against currency debasement.

BlackRock's Stature

BlackRock is the world's largest asset management firm, with a whopping $10.6 trillion in assets under management. When a giant like BlackRock changes its view, the world takes notice.

Fink's Evolution

Speaking to CNBC's ' Squawk on the Street', Fink shared his new outlook. He said he went away and studied Bitcoin. He learned about the asset class and has now changed his opinion. "I'm a major believer that there is a role for Bitcoin in portfolios," said Fink.

Fink's stance on Bitcoin has evolved significantly over the years, reflecting the broader journey of institutional acceptance of Bitcoin. In the early years, Fink was skeptical about Bitcoin and the broader crypto market. He frequently voiced concerns about Bitcoin's speculative nature, emphasizing the risks associated with its volatility.

Bitcoin: A Legitimate Financial Instrument

"I believe Bitcoin is legitimate. I'm not trying to say there's not that misuses like everything else. However, it is a legitimate financial instrument that allows you to have uncorrelated or non-correlated returns. I believe it is an instrument you invest in when you're more frightened. It is an instrument when you believe that countries are debasing their currency by access deficits," said Fink.

In 2017, during the height of the crypto boom, Fink described Bitcoin as an "index of money laundering," highlighting its potential use in illicit activities.

His skepticism was consistent with the broader sentiment among many financial industry leaders at the time, who viewed cryptocurrencies with caution and suspicion.

Turning Point: BlackRock's Spot Bitcoin ETFs

The turning point in Fink's stance came when BlackRock's ETF was one of 11 spot bitcoin ETFs approved by the Securities and Exchange Commission (SEC) in January. Fink said he now sees Bitcoin's potential as "digital gold."

"I'm a major believer that Bitcoin has a role in portfolios."

This shift in perspective by a significant financial figure like Larry Fink could pave the way for broader acceptance of Bitcoin within institutional portfolios. It marks a noteworthy moment in the evolution of cryptocurrency as a mainstream investment.