BlackRock CEO Larry Fink Warns That Bitcoin Could Replace the U.S. Dollar as the World's Reserve Currency

In his annual letter, Larry Fink, the CEO of asset management firm BlackRock, has warned that the U.S. dollar could potentially lose its hegemony to Bitcoin.

Larry Fink, CEO of asset management firm BlackRock, has warned that the U.S. dollar could lose its hegemony to Bitcoin as the U.S. national debt balloons and threatens the greenback’s long-standing reserve currency status.

Fink said that Bitcoin might become a more preferable investment than the U.S. dollar.

“We see the U.S. dollar remaining the principal reserve currency for the foreseeable future. But the metaverse, blockchain, and decentralized finance could undermine the economic advantage that the U.S. has built over the last 75 years,” Fink wrote in his annual letter to executives on Wednesday.

Decentralized finance could potentially reduce the need for institutions and government bodies, which in turn could lessen the U.S.’s role in the global financial system, he added.

Back in 2020, Fink said that Bitcoin could become a global market like gold.

This year, asset management titan applied for Bitcoin ETFs, which were later approved by the U.S. Securities and Exchange Commission. The move came after years of applying for ether (ETH) ETFs.

Last October, Fink said that he viewed Bitcoin as a gold alternative.

A looming debt crisis?

The U.S. national debt currently stands at $36.6 trillion, exceeding the size of the country’s economy. Federal interest payments are expected to exceed $1 trillion in 2026.

U.S. lawmakers will need to take action on the debt limit by either raising or suspending it. According to the Congressional Budget Office, a potential default is looming this summer.

Earlier this month, billionaire hedge fund manager Ray Dalio predicted that the U.S. could face a severe debt crisis in a few years from now.

Some pro-Bitcoin analysts say that high national debt could devalue the dollar and benefit the leading cryptocurrency, which is known for its scarcity and serves as a hedge against inflation.

Meanwhile, Strategy co-founder Michael Saylor has said that a U.S. strategic reserve could help reduce national debt.