On March 19, BlackRock revealed that it is preparing to offer a fund through a partnership with digital asset tokenization specialist Securitize.
According to a presentation According to the US Securities and Exchange Commission, the Wall Street giant plans to launch the “BlackRock USD Institutional Digital Liquidity Fund.” However, the total size of the fund was not disclosed.
It feels very good for ethereum, commented Galaxy CEO Mike Novogratz on March 20.
This feels very important to $eth!!! https://t.co/UJVnIhm5pJ
-Mike Novogratz (@novogratz) March 19, 2024
BackRock Pivot to RWA
The fund will be based on the ethereum blockchain and will trade under the symbol BUIDL. The ethereal ADDRESS hosting it had its first transfer about two weeks ago, according to Etherscan. It contains 100 BUIDL tokens and has a holder.
BlackRock's real-world asset (RWA) tokenization partner Securitize is already working with KKR, Hamilton Lane and others on tokenized funds, Bloomberg reported.
However, the new product is only available to institutional investors, with the minimum accepted investment set at $100,000.
RWA tokenization is a process of placing traditional assets such as gold, commodities, treasuries, and real estate on the blockchain. It's been predicted to become a multibillion-dollar industry over the next decade, and Wall Street wants in on the action.
Large banks such as JPMorgan, Citi, and Bank of America are experimenting with RWA tokenization.
Private wealth management firm Bernstein has estimated that around 2% of the global money supply, roughly $3 trillion, could be tokenized on the blockchain over the next five years. Additionally, Citigroup has estimated that the tokenization market could grow to $5 trillion by 2030.
eth price in retreat
Additionally, news of the fund comes amid hopes that the SEC could approve an ethereum spot ETF in May. However, analysts have been reducing their approval odds since the regulator cut ties with fund issuers, and complications could arise with betting.
BlackRock is among the fund managers that have filed for a spot eth ETF following the approval and success of its bitcoin product.
ethereum prices did not react to the news and retreated a further 5.8% on the day, falling to $3,150 during early Asian trading on Wednesday.
eth had recovered marginally to trade just above $3,200 at the time of writing, but the crypto correction looks set to deepen.
ethereum has fallen 21% from its 2024 high of $4,070 on March 12 and remains 34% below its late-2021 peak price.
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