BlackRock, the prominent American asset management company, has introduced its first tokenized fund called the BlackRock USD Institutional Digital Liquidity Fund (BUIDL) on the Ethereum blockchain. This move signifies BlackRock’s continued efforts to solidify its presence in the blockchain industry. The collaboration with Securitize, a startup specializing in tokenizing real-world assets, has made the creation of BUIDL possible.
BlackRock’s foray into the crypto space over the past year has been a significant development in the industry. Many believe that the company’s support for the spot Bitcoin ETF last year played a crucial role in obtaining approval for the product. However, the launch of BUIDL with Securitize marks a pivotal moment for BlackRock. The primary objective is to provide qualified investors with an opportunity to earn Dollar rewards by investing in the fund.
In addition, BlackRock will enable BUIDL subscribers to issue and trade ownership on Ethereum, gain exposure to on-chain products, and facilitate on-chain settlement. The BUIDL product will maintain a stable value of $1 per token, as per the economic dynamics. BlackRock plans to invest the assets under management in cash, US Treasury bills, and repurchase agreements.
A significant aspect of the fund is its collaboration with BNY Mellon, a banking giant that will ensure interoperability between digital and mainstream finance markets. Other important players in the BUIDL ecosystem include Anchorage Digital Bank, Fireblocks, and Coinbase, which are long-term partners of BlackRock in the crypto space.
The trend of mainstream companies embracing crypto offerings is reaching its peak, as demonstrated by Commerzbank becoming the first full-service bank in Germany to obtain a crypto custody license. Ripple and its subsidiary Metaco have also played a vital role in bridging the gap for mainstream banks seeking to offer crypto custody services. HSBC, a British multinational bank, adopted Ripple’s solution in November last year to provide institutional crypto custody services.
Please note that this article is for informational purposes only and should not be considered financial advice. The views expressed in this article are the author’s personal opinions and do not reflect the opinion of The Crypto Basic. Readers are advised to conduct thorough research before making any investment decisions, and The Crypto Basic is not liable for any financial losses incurred.