BlackRock Launches First Tokenised Fund
Posted by Colin Lambert. Last updated: March 21, 2024
Investment giant BlackRock has unveiled its its first tokenised fund issued on a public blockchain, the BlackRock USD Institutional Digital Liquidity Fund (BUIDL), which will provide qualified investors with the opportunity to earn US dollar yields by subscribing to the fund through Securitize Markets.
As part of the launch, BlackRock has also taken a stake in Securitize Markets, which will see Joseph Chalom, BlackRock’s global head of strategic ecosystem partnerships appointed to Securitize’s board of directors.
“This is the latest progression of our digital assets strategy,” says Robert Mitchnick, BlackRock’s head of digital assets. “We are focused on developing solutions in the digital assets space that help solve real problems for our clients.”
The firm say tokenisation remains a key focus of BlackRock’s digital asset strategy, adding that through the tokenisation of the Fund, BUIDL will offer investors important benefits by enabling the issuance and trading of ownership on a blockchain, expanding investor access to on-chain offerings, providing instantaneous and transparent settlement, and allowing for transfers across platforms.
BNY Mellon will enable interoperability for the fund between digital and traditional markets, BalckRock says.
“Tokenisation of securities could fundamentally transform capital markets,” observes Carlos Domingo, co-founder and CEO of Securitize. “Today’s news demonstrates that traditional financial products are being made more accessible through digitisation.”
BUIDL seeks to offer a stable value of $1 per token and pays daily accrued dividends directly to investors’ wallets as new tokens each month. The fund invests 100% of its total assets in cash, US Treasury bills, and repurchase agreements, allowing investors to earn yield while holding the token on the blockchain. Investors can transfer their tokens 24/7/365 to other pre-approved investors. Fund participants will also have custody options allowing them to choose how to hold their tokens.
BlackRock says the initial ecosystem participants in BUIDL include Anchorage Digital Bank, BitGo, Coinbase, and Fireblocks, among other market participants and infrastructure providers in the crypto industry.
