BlackRock, the world’s largest asset manager, according to analysts at research and brokerage firm Bernstein. Ethereum It plans to launch a tokenized fund that “gives legitimacy” to public smart contract chains such as
Analysts Gautam Chhugani and Mahika Sapra wrote in a note to clients today that the decision to use the public Ethereum blockchain as opposed to private chains like JPMorgan’s Onyx increases interoperability and programmability in an industry previously viewed as “individual casinos”:
“Use of tokenized funds can be on-chain with stablecoin (e.g. USDC) integration. New asset classes (bonds, stocks, stablecoins) could lead to interoperability between on-chain asset classes and greater programmability based on settlement agreement terms.
“The system built for individual speculation is starting to bring about corporate use areas.”
BlackRock USD Institutional Digital Liquidity Fund (BUIDL) will be a liquid fund that invests in U.S. Treasury bills, repurchase agreements (short-term borrowing agreements for sellers of government bonds) and cash, according to U.S. Securities and Exchange Commission filings. However, a launch date was not given.
While tokenized funds aren’t new, with Franklin Templeton launching a tokenized money market fund in 2021, BlackRock has both traditional and cryptocurrency The decision to find global partners could reduce friction by encouraging more traditional institutional customers to adopt on-chain funds.
“Tokenization can be seen as the next evolution of financial markets, similar to the ETF wave of the last 20 years,” concluded Chhugani and Sapra.
*This is not investment advice.
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