BlackRock Executive Warns Bitcoin Stability Threatened by Leverage Volatility
# BlackRock's Digital Assets Chief: Bitcoin's Stability at Risk from Leverage Volatility
### Concerns Raised Over Market Dynamics Affecting Bitcoin's Institutional Appeal
BlackRock's head of digital assets, Mitchnick, has voiced serious concerns regarding the impact of leverage-driven volatility on Bitcoin. According to Mitchnick, this volatility threatens to undermine Bitcoin's position as a "global, scarce, decentralized monetary asset." He elaborated that recent market fluctuations are causing great concern among institutional investors, who might doubt Bitcoin's stability.
In a specific example, Mitchnick noted an incident from October 10th, stating, "These days where you have a tiny little thing that shouldn't have any price impact really at all — and if it does, should be small — like, for example, October 10th, some tariff-related thing, and next thing you know, [bitcoin] is down 20%." He emphasized that this kind of sharp decline highlights underlying issues of market health that need to be addressed.
Mitchnick explained that cascading liquidations and auto-deleveraging are significant contributors to this instability. "That's because you get cascading liquidations and auto-deleveraging," he added, pointing to these factors as key elements in creating unnecessary market turbulence.
The implications of this volatility could be significant for Bitcoin's narrative as an asset, and Mitchnick's comments urge a reevaluation of current trading practices to ensure that investor confidence remains intact.
This report is for informational purposes only and is not financial advice.