BlackRock has launched the BUIDL Fund on Ethereum, its first tokenized fund on a public blockchain, fully collateralized by cash and US Treasury bonds, with customers earning USD yields.
Investors can now trade their fund shares on a transparent blockchain with instant settlement, with BNY Mellon facilitating interoperability with traditional markets.

Asset management behemoth BlackRock is diving deeper into crypto, and this time, it’s expanding its presence in the Ethereum ecosystem. The firm recently announced the launch of its first-ever tokenized fund issued on a public blockchain.

The new fund, known as the BlackRock USD Institutional Digital Liquidity Fund or BUIDL, will be available only to qualified investors who will earn US dollars for subscribing to the fund. Issued on the Ethereum blockchain, it enables investors to trade ownership on a transparent and public network. The blockchain will offer investors instant settlement and allow for fast transfers across platforms.

BlackRock has partnered with American banking giant BNY Mellon as the custodian and administrator, enabling investors to switch between the digital and traditional markets.

It has also partnered with Securitize, a global leader in tokenizing real-world assets. Securitize will offer a tokenization platform and act as a transfer agent. It will manage the tokenized shares and report on other aspects of the fund, including subscriptions, distributions and redemptions.

Other crypto market heavyweights, including Coinbase, BitGo, Anchorage Digital Bank, and Fireblocks, will also participate in the ecosystem.

Commenting on BUIDL, Securitize CEO Carlos Domingo stated:

Tokenization of securities could fundamentally transform capital markets. Today’s news demonstrates that traditional financial products are being made more accessible through digitization. Securitize is proud to be BlackRock’s transfer agent, tokenization platform and placement agent of choice in digitizing and expanding access to its investment products.

BlackRock Bets on Ethereum Amid ETH Investigations

BlackRock’s bet on Ethereum is a significant vote of confidence on the world’s largest blockchain network. The asset manager is a kingmaker in most sectors, with its financial muscle and vast network opening new opportunities for any company, system, or network it invests in.

With BUIDL, BlackRock is throwing its weight behind Ethereum at a time when tokenization is becoming the focal point of blockchain’s mainstream appeal.

BUIDL will offer a stable value pegged at $1 per token, with investors receiving daily accrued dividends from their shares as new tokens every month. It will only invest in US Treasury bills, cash and repurchase agreements. They can sell their shares to other qualified investors any time of the day, year-round, and choose how they want to custody their tokens.

Commenting on BUIDL, BlackRock’s Head of Digital Assets Robert Mitchnick stated:

This is the latest progression of our digital assets strategy. We are focused on developing solutions in the digital assets space that help solve real problems for our clients, and we are excited to work with Securitize.

The vote of confidence on Ethereum comes amid investigations into the Ethereum Foundation by unnamed authorities, as Crypto News Flash previously reported.

Meanwhile, Ether trades at $3,391, trading in a tight range over the past day.

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Filed under: Bitcoin - @ March 24, 2024 5:05 pm