BlackRock takes a big more towards asset tokenization through its SEC filing for the USD Institutional Digital Liquidity Fund.
By Bhushan Akolkar
Edited by Julia Sakovich
Updated
3 mins read
On Tuesday, February 19, the world’s largest asset manager BlackRock notified the regulators that it planning to launch a tokenized investment fund in partnership with Securitize. This is yet another major move from BlackRock in the digital assets market, after the Bitcoin ETF launch in January 2024.
Last Thursday, BlackRock submitted a Form D, notifying the US Securities and Exchange Commission about its USD Institutional Digital Liquidity Fund. The fund requires a minimum investment of $100,000 from outside investors. Moreover, the fund also estimates sales commissions totaling $525,000 with no finder’s fees disclosed.
Although the filing did not specify a launch date, Securitize Markets, a digital assets platform in Miami, was named as the entity overseeing the sale. Additionally, a token named BlackRock USD Institutional Digital Liquidity Fund (BUIDL) was minted on the Ethereum blockchain on March 5, boasting a maximum supply of 100 tokens, with only one holder identified thus far.
Crypto market analysts highlighted blockchain data indicating a transfer of $100 million worth of Circle’s USDC stablecoin on the Ethereum network to an address associated with a Securitize deployer. This movement suggests a potential seed investment into the fund, although confirmation is pending.
The submitted document does not disclose the specific assets the fund will encompass. However, Securitize’s involvement hints at a possible connection to the tokenization of real-world assets (RWA). The term RWA represents the ownership of various assets via tokens on a blockchain.
“As blockchain technology reshapes the financial landscape, Securitize has emerged as the leader in tokenization.”
Securitize is building the future of finance through the tokenization of real world assets, and we’re so proud to be named to Fast Company’s prestigious list of the… pic.twitter.com/67JTIQbqlc
— Securitize (@Securitize) March 19, 2024
BlackRock’s recent venture into digital asset funds marks a strategic expansion. The key development is the introduction of a spot Bitcoin ETF in January. Within two months of launch, BlackRock’s IBIT garnered over $15 billion in assets under management. Additionally, the company filed for a spot Ether ETF last year.
According to BlackRock CEO Larry Fink, BTC and ETH ETFs serve as initial stages towards tokenization, emphasizing his belief in the trajectory towards tokenized assets as the future direction. Last year in June 2023, Fink stated that the Bitcoin ETFs offer a way to “democratize crypto” while offering a more cheaper and convenient way to invest in crypto.
“We do believe that if we can create more tokenization of assets and securities – that’s what Bitcoin is – it could revolutionize finance. Instead of investing in gold as a hedge against inflation, a hedge against the onerous problems of any one country, or the devaluation of your currency whatever country you’re in – let’s be clear, Bitcoin is an international asset, it’s not based on any one currency and so it can represent an asset that people can play as an alternative,” the BlackRock CEO said.
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Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.
