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BlackRock Launches Its First Tokenized Fund, BUIDL, on Ethereum

BUIDL aims to provide investors with an opportunity to earn U.S. dollar returns by investing in cash, U.S. Treasury bills, and repurchase agreements.

Image Source: Jeenah Moon/Bloomberg
  • BlackRock launches BUIDL, its first tokenized fund on the Ethereum blockchain, aimed at offering investors U.S. dollar yields through investments in cash, U.S. Treasury bills, and repurchase agreements.
  • Securitize partners with BlackRock to manage the transfer and tokenization of the BUIDL fund, with BNY Mellon safeguarding the assets.

Global asset management giant, BlockRock, has rolled out its first tokenized fund — BlackRock USD Institutional Digital Liquidity Fund, dubbed BUIDL — on the Ethereum blockchain. 

Situated in the British Virgin Islands and keeping in line with U.S. regulations, BUIDL sets out to offer investors a taste of U.S. dollar yields by dipping into cash, U.S. Treasury bills, and repurchase agreements. 

The starting investment threshold for the fund is set at $5 million. Investors have the opportunity to buy tokens at a consistent price of $1 each and receive interest as additional tokens.

“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.”

Asset tokenization firm Securitize will handle the transfer and tokenization of the fund, with BNY Mellon being the custodian of the assets. Anchorage Digital Bank, BitGo, Coinbase, and Fireblocks will also be involved in the fund.

BlackRock's recent venture follows its successful launch of the iShares Bitcoin Trust, one of the largest Bitcoin ETFs, which has seen unprecedented inflows.

Also, this move aligns with a broader shift in the finance industry, with major players such as Citi, Franklin Templeton, and JPMorgan exploring the transformative potential of blockchain on conventional financial practices.

Edited by Harshajit Sarmah