Blackrock, the world’s largest asset manager, laid out its vision for 2026 and, beyond its bearish outlook for US bonds and the world’s largest economy, it is a bullish plan for institutional adoption of cryptocurrencies.
US federal debt will exceed $38 trillion, setting the tone for a market outlook defined by the fragility and failure of traditional hedges, according to the report. For cryptocurrencies, it is good news, because this economic environment will lead to accelerated adoption of digital assets among Wall Street giants.
Higher government borrowing “…creates vulnerabilities to shocks such as spikes in bond yields linked to fiscal concerns or political tensions between managing inflation and debt service costs,” the report says.
The warning about long-term US Treasuries, the traditional backbone of finance, is a sign that AI-driven leverage and government debt will likely make the financial system more fragile and may force institutions to turn to alternative assets like bitcoin. as protection against fiscal failure.
The institutional rush of money into cryptocurrencies, exemplified by BlackRock’s $100 billion in bitcoin ETF allocations, its main source of revenue, promises to drive digital assets to all-time highs next year, with some analysts predicting the largest cryptocurrency will rise above $200,000.
This is all part of a “modest but significant step toward a tokenized financial system,” which provides the decentralized infrastructure to handle private credit and asset management institutions seeking. CEO Larry Fink described tokenization as the next generation of financial markets. The report from the world’s largest asset manager says it clearly: where public debt fails, the digital economy begins.
As for stablecoins, digital assets whose value is tied to a real-world asset like the dollar or gold, “they are no longer a niche, they are becoming the bridge between traditional finance and digital liquidity,” said Samara Cohen, global head of market development at Blackrock.
The increase in computing power to drive AI is already benefiting bitcoin miners, who can convert their energy deals into new uses as growing demand for high-performance computing increases the value of their infrastructure. AI development is not limited by chips, but by power, according to the report. In fact, AI data centers could demand up to 20% of current US electricity by 2030.
Several publicly traded mining companies reported increased revenue this year not only from mining, but also from leasing data center capacity to artificial intelligence companies that need power-hungry GPUs.
