Larry Fink calls for an end to investment inequality

BlackRock chairman and CEO Larry Fink used his 2025 annual letter to investors to call for a restructured investment landscape – one in which access to capital markets is broadened through both traditional reforms and emerging technologies such as tokenization.

The message builds on Fink’s long-standing focus on retirement security and financial inclusion, but this year’s letter strikes a more direct tone on the need to correct what he describes as a growing structural imbalance in the markets. His central argument: the wealth generated by decades of globalization and market growth has been concentrated too narrowly, leaving millions of individuals locked out of ownership and opportunity.

“Today, many countries have twin, inverted economies: one where wealth builds on wealth; another where hardship builds on hardship,” Fink wrote in his latest annual letter published Monday. “But there’s another way to look at it: Capitalism did work – just for too few people.”

Fink pointed to the current private market environment as one of the most pressing challenges. While private assets such as infrastructure, real estate, and private credit have become major drivers of portfolio performance, he noted that access remains largely limited to institutional investors and high-net-worth individuals.

“Assets that will define the future – data centers, ports, power grids, the world’s fastest-growing private companies – aren’t available to most investors,” he wrote. “They’re in private markets, locked behind high walls, with gates that open only for the wealthiest or largest market participants.”

Over the past 14 months, BlackRock has ramped up its presence in private markets, acquiring firms in both private credit and infrastructure and investing in data capabilities to help reduce barriers to entry. But Fink acknowledged that broader access will also require rethinking traditional portfolio models.

He suggested that the standard 60/40 mix of stocks and bonds may no longer offer sufficient diversification. In its place, he proposed a 50/30/20 framework, with private assets making up 20 percent of a portfolio. Yet most individual investors, he said, lack both the access and the capital required to build meaningful exposure to those assets.

“Bridging the divide between the 50/30 and the 20 is almost impossible for most individuals,” he wrote. “Even those who can afford it face another diversification problem within that 20 percent.”

Fink also emphasized the looming  challenges of retirement, a theme he highlighted in his annual letter last year. Citing Census Bureau data, he noted that Social Security currently keeps nearly 30 million Americans out of poverty each year. However, its retirement and disability trust funds are projected to be depleted by 2035, at which point beneficiaries would receive only 83 percent of their scheduled payments.

“But even if we shore up Social Security, it’s not enough,” he wrote. “A good retirement system provides a safety net to catch people when they fall. But a great system also offers a ladder – a way to grow savings, compounding wealth year after year. That’s where the U.S. falls short.”

Among the reforms he outlined were expanding emergency savings programs, addressing the lack of retirement plans at small businesses, and enabling people to begin investing earlier in life.

He also gave a nod to new technologies – particularly tokenization – as a way to radically reshape access.

“What exactly is tokenization?” Fink wrote. “It’s turning real-world assets – stocks, bonds, real estate – into digital tokens tradable online.”

These tokens, secured on a blockchain, certify ownership and allow for instant, paperless transactions. More importantly, Fink argued, they enable fractional ownership – lowering the cost of entry for individuals and opening the door to private market assets that were previously out of reach.

“Tokenization allows for fractional ownership,” he wrote. “This lowers one of the barriers to investing in valuable, previously inaccessible assets like private real estate and private equity.”

Fink also highlighted the potential for tokenization to enhance shareholder democracy and widen access to yield. Because tokenized assets are digitally tracked, shareholder voting can become more seamless and secure, while friction in high-return investment opportunities—such as legal and operational hurdles—can be reduced.

“It can democratize yield,” he wrote. “Some investments produce much higher returns than others, but only big investors can get into them. One reason? Friction. Legal, operational, bureaucratic. Tokenization strips that away.”

While Fink stopped short of predicting a specific timeline for widespread adoption of tokenization, he positioned it as a key enabler of the larger goal: expanding who gets to participate in the financial system and benefit from its growth.

“The solution isn’t to abandon markets; it’s to expand them,” he wrote. “To finish the market democratization that began 400 years ago and let more people own a meaningful stake in the growth happening around them.”

As BlackRock continues to pursue product innovation and acquisitions aimed at improving access to private markets, Fink’s letter appears to set the tone for how the firm – and potentially the broader industry – intends to frame the next phase of wealth creation: one centered less on preservation of capital for the few and more on broader inclusion for the many.

“I’ve always said investing is an act of hope – that no one invests for the long term unless they believe the future will be better than the present,” Fink wrote. “But that’s not quite right. Investing isn’t just an act of hope; investing is what makes our hopes, our reality.”