On Wednesday, BlackRock, the world's largest asset manager, Announced launching its first tokenized fund on the ethereum blockchain, marking a significant step in bridging the gap between traditional finance and digital assets. The BlackRock USD Institutional Digital Liquidity Fund, known as BUIDL, aims to provide qualified investors with US dollar returns through blockchain technology.
BlackRock chooses ethereum
According to Robert Mitchnick, head of digital assets at BlackRock, the introduction of BUIDL is a continuation of the company's commitment to innovation in the digital asset space. “This is the latest progression of our digital asset strategy,” said Mitchnick, highlighting the goal of developing solutions that address real-world client needs while also expressing excitement about the collaboration with Securitize.
Securitize is proud to announce that we have partnered with @BlackRock. Together, we are launching the BlackRock USD Institutional Digital Liquidity Fund (BUIDL).
BUIDL will provide investors with the opportunity to earn returns in US dollars by subscribing to the fund with Securitize… pic.twitter.com/nDsNehOXJU
– Securitize (@Securitize) March 20, 2024
Tokenization is at the heart of BlackRock's digital asset strategy, and BUIDL enables the issuance and trading of property on the ethereum blockchain. This approach not only expands access to on-chain offerings, but also ensures instant and transparent settlement, along with cross-platform interoperability, courtesy of BNY Mellon.
Carlos Domingo, co-founder and CEO of Securitize, emphasized the transformative potential of tokenization in capital markets, noting: “Today's news demonstrates that traditional financial products are becoming more accessible through digitalization.”
BUIDL is designed to maintain a stable value of $1 per token, distributing daily accumulated dividends directly to investors' wallets as new tokens each month. The fund primarily invests in cash, US Treasury bills and repurchase agreements, ensuring a secure return for token holders on the blockchain.
Additionally, BUIDL's ecosystem includes prestigious names such as Anchorage Digital Bank NA, BitGo, Coinbase, and Fireblocks, establishing a solid foundation for the fund's operations.
Strategic collaboration extends beyond product launch: BlackRock makes strategic investment in Securitize and appoints Joseph Chalom, its global head of strategic ecosystem partnerships, to Securitize's board of directors.
This initiative represents a critical moment in the evolution of digital assets, signaling the growing integration of blockchain technology with traditional financial instruments. The fund's tokenized structure offers a vision of the future of investing, where accessibility, transparency and efficiency reign supreme.
ethereum Community Rejoices Euphorically
Reactions from the ethereum community have been overwhelmingly positive, with industry figures such as Anthony Sassano and Ryan Berckmans citing the launch as a bullish sign for both ethereum and the broader crypto market.
Sassano, founder of The Daily Gwei newspaper, commented“BlackRock's launch of a yield stablecoin on ethereum remains one of the most bullish things to ever happen in the cryptocurrency space and the market definitely hasn't digested it yet,” underscoring the significant impact of such a move.
Ryan Berckmans fixed, “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. I didn't realize that BlackRock launched *a yield stablecoin* on eth. Stable products that generate performance are top-of-the-line products. Very optimist”.
Seraphim Czecker, Head of Growth at Ethena Labs aggregate his enthusiasm and stated: “Damn Blackrock launched a stablecoin with yield and you are not optimistic about cryptocurrencies. “We've come a long way.”
At the time of this publication, eth was trading at $3,549.
Featured image from DW, chart from TradingView.com
