BlackRock's Former Digital Assets Head Believes Ethereum is the Future Infrastructure for Wall Street

Joseph Chalom, a former executive at BlackRock and current co-CEO of Sharplink, has asserted that Ethereum is poised to become the foundational infrastructure for Wall Street's digital finance initiatives. His conviction stems from Ethereum's inherent qualities of trust, security, and liquidity, which he believes are paramount for financial institutions.

Key Takeaways

• Ethereum possesses the majority of stablecoins, tokenized assets, and high-quality smart contract activity, making it suitable for digitizing finance.

• Unlike Bitcoin, which is viewed as a store of value, Ethereum is considered a "productive asset" due to its staking yield.

• Chalom's firm, Sharplink, holds over $3 billion in staked Ether and is exploring restaking strategies.

• He envisions a future where the distinction between Decentralized Finance (DeFi) and Traditional Finance (TradFi) blurs, with Ethereum serving as the underlying infrastructure.

Ethereum's Appeal to Financial Institutions

Chalom, who spent two decades at BlackRock scaling the Aladdin platform and later led the firm's crypto ventures, highlighted Ethereum's suitability for institutional adoption. He pointed to its robust ecosystem, including a significant presence of stablecoins and tokenized assets, as well as substantial smart contract activity. "If you're going to digitize finance, you need a chain institutions can trust — and it's Ethereum," Chalom stated.

A "Productive Asset" for Yield Generation

A key differentiator for Ethereum, according to Chalom, is Ether's native yield generated through staking. While Bitcoin is often seen as a passive store of value, Ether offers an annual yield of approximately 3% via Ethereum's proof-of-stake mechanism. Chalom described this as a "productive asset" whose yield can be returned to stakeholders. His firm, Sharplink, which manages over $3 billion in Ether, has nearly all of its holdings staked and is actively exploring advanced strategies like "restaking" through partnerships with Consensys, Linea, and EigenLayer, all while maintaining assets with regulated custodians.

Bridging TradFi and Crypto

Chalom views his current role at Sharplink not as a departure from his BlackRock career but as a continuation of his mission to integrate traditional finance with the crypto ecosystem. He believes Ethereum offers an opportunity to rebuild financial infrastructure to be faster, cheaper, and more secure than the intermediary-laden systems of the past. He anticipates a future where the lines between DeFi and TradFi dissolve, with Ethereum forming the core infrastructure for all financial activities.

Challenges for Digital Asset Treasuries

While Sharplink is accumulating Ether, Chalom noted that many other digital asset treasury companies may struggle to scale effectively. He cited the need for strong trading volumes, clean balance sheets, and internal expertise in managing staking and investments as critical factors for success, suggesting that many will likely underperform without these elements.

Sources

• Ethereum (ETH) Is ‘The Infrastructure’ for Wall Street, Says Ex-BlackRock Exec, CoinDesk.

• Ethereum Is ‘The Infrastructure’ for Wall Street, Says Former BlackRock Executive, Yahoo Finance.

• Blackrock Crypto Ambitions Rest On Ether: Ethereum Price Prediction And ETH News, Yahoo Finance.