BlackRock, the world’s largest asset management firm, is reportedly downsizing its global workforce by approximately 3%, strategically timed just before the anticipated approval of its spot Bitcoin ETF application by the US Securities and Exchange Commission (SEC).
Although the layoffs affecting around 600 employees have not been officially announced, sources familiar with the matter revealed the move to Fox Business on Saturday.
Described as “routine,” these job cuts follow a similar round in the previous year based on “employee performance metrics.”
BlackRock’s strategic realignment reflects its entrance into a “more mature phase” of business, despite a 6% rebound in shares in 2023 after a 21% decline in 2022.
The impending layoffs are expected to contribute to the company’s shift towards expanding into growth areas like technology investing and alternative products, redirecting savings accordingly.
In recent times, BlackRock, a pioneer in ESG (environmental, social, and governance) investing, has de-emphasized its ESG business in the US, with CEO Larry Fink refraining from mentioning ESG due to political controversy.
Despite controversy, BlackRock remains a financial powerhouse, managing $9 trillion in assets as of the third quarter of 2023, down from a peak of over $10 trillion in 2022.
As BlackRock navigates these shifts, attention is focused on the SEC decision regarding its Bitcoin ETF, a potential significant step into the crypto space. The SEC is expected to approve pending applications for spot Bitcoin ETFs in the US by January 10, and trading for approved ETFs may commence as early as January 11, according to analysts.