BlackRock is launching a tokenized asset fund on Ethereum and investing in the fund’s tokenization platform Securitize.
Posted: March 21, 2024 4:25 AM Updated: March 21, 2024 4:25 AM
Correction and fact check date: March 21, 2024, 4:25 a.m.
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BlackRock launches USD institutional digital liquidity fund on Ethereum. Represented by the BUIDL token, it provides daily returns to token holders.
Investment firm BlackRock has officially launched its tokenized asset fund on the Ethereum (ETH) network. The BlackRock USD Institutional Digital Liquidity Fund is represented by BUIDL, a blockchain-based token fully backed by cash, U.S. Treasury bills, and repurchase agreements, with returns distributed daily to token holders via the blockchain.
BlackRock also made a strategic investment in Securitize, an asset tokenization company. However, specific transaction terms were not disclosed.
Securitize serves as the fund’s transfer agent and tokenization platform, while BNY Mellon acts as custodian of the fund’s assets. Anchorage Digital Bank NA, BitGo, Coinbase and Fireblocks are also participating in the fund ecosystem.
“This is the latest progress in our digital asset strategy,” Robert Mitchnick, head of digital assets at BlackRock, said in a written statement. “We are focused on developing solutions in the digital asset space that help solve real-world problems for our customers, and we are excited to partner with Securitize.”
BlackRock enters the tokenization space amid growing interest in RWA tokenization.
With the introduction of its latest tokenized asset fund, BlackRock joins other major players in traditional finance such as Citi, Franklin Templeton, and JPMorgan to explore the tokenization space. Tokenization of real assets (RWA) involves creating blockchain-based tokens for traditional investments such as bonds and funds. This practice is gaining momentum as digital assets and traditional finance continue to converge.
Tokenized U.S. Treasury bonds alone have increased from $100 million to $720 million in early 2023, according to a report by tokenized RWA analytics firm RWA.xyz. This growth reflects the efforts of cryptocurrency-related businesses to generate consistent returns by allocating on-chain funds.
In an interview with CNBC earlier this year, BlackRock CEO Larry Fink expressed his belief that tokenization has the potential to solve problems related to money laundering and other forms of corruption.
He also said about Blackrock’s launch of a spot Ethereum exchange-traded fund (ETF), “I see the value of having an Ethereum ETF.” This is just a stepping stone towards tokenization and I truly believe this is the direction we are going.”
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Alisa is a reporter for Metaverse Post. She focuses on everything related to investing, AI, metaverse, and Web3. Alisa holds a degree in Art Business and her expertise lies in the fields of art and technology. She developed a passion for journalism through her work with VCs, notable cryptocurrency projects, and science writing. You can contact us at (email protected).
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alice davidson
Alisa is a reporter for Metaverse Post. She focuses on everything related to investing, AI, metaverse, and Web3. Alisa holds a degree in Art Business and her expertise lies in the fields of art and technology. She developed a passion for journalism through her work with VCs, notable cryptocurrency projects, and science writing. You can contact us at (email protected).
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