BlackRock Launches Tokenized Fund on Ethereum

BlackRock has established its first tokenized fund on the Ethereum network. The BlackRock USD Institutional Digital Liquidity Fund, or BUIDL, is fully collateralized with cash, US Treasury bills, and repurchase agreements. It offers qualified investors the possibility to earn US dollar yields.

BlackRock has teamed with Securitize Markets, LLC as a transfer agent and tokenization platform, and BNY Mellon as the fund’s custodian. Anchorage Digital Bank NA, BitGo, Coinbase, and Fireblocks will all supply infrastructure for the fund.

To invest in the fund, qualified investors with at least $25 million in investable assets must first construct a digital wallet and sign up with Securitize. The initial investment requirement is $5 million. Investors can buy a token at a fixed price of $1 and earn interest in the form of tokens. Tokens can be readily transferred from one wallet to another using the blockchain network.

“This is the latest progression of our digital assets strategy,” said 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, and we are excited to work with Securitize.”

The launch of BUIDL comes just a few months after it established the largest Bitcoin ETF, iShares Bitcoin Trust, which has continued to see record inflows. Other investment heavyweights, including Franklin Templeton and Ondo Finance, have created tokenized versions of money-market funds and exchange-traded funds, respectively.