BlackRock Launches $100 Million Tokenized Asset Fund On Ethereum

Table of Contents

• BlackRock Announces New Fund
• Real-World Assets (RWAs)
• BlackRock’s Foray Into Crypto

BlackRock, the world’s largest asset manager, has launched a new tokenized fund on Ethereum, according to a March 19 filing with the Securities and Exchange Commission.

The fund, resulting from a collaboration with Securitize, aims to boost market accessibility and real-world asset tokenization.

BlackRock Announces New Fund

The fund called the BlackRock USD Institutional Digital Liquidity Fund, is based in the British Virgin Islands and results from a partnership with Securitize. While details regarding the fund are under wraps, the collaboration with Securitize hints at a focus on Real-World Assets (RWA) tokenization. Securitize is known for its expertise in asset tokenization. According to on-chain data, BlackRock has seeded the fund with an initial capital of $100 million USDC on the Ethereum blockchain. Both companies are yet to make a public announcement regarding the SEC filing and the new fund.

Real-World Assets (RWAs)

BlackRock’s USD Institutional Digital Liquidity Fund is an indication of the growing interest in the tokenization of real-world assets. This emerging sector of RWA tokenization combines the capabilities of digital assets with those of traditional finance, streamlining the settlement process and enhancing traditional efficiency through blockchain technology.

The crypto markets responded positively to BlackRock’s announcement, with ONDO, the native token of Ondo Finance, showing a significant increase in value. Ondo Finance is a platform that facilitates the tokenization of real-world assets. According to data from CoinMarketCap, the ONDO token is trading at $0.55 after registering an increase of nearly 35% over the past 24 hours despite the drop in the overall market. Another RWA token, Ribbon Finance (RBN), registered an increase of over 9% following the announcement.

With the fund’s announcement, BlackRock has positioned itself at the vanguard of efforts to integrate digital assets with traditional financial services. The fund could also set a trend for more institutional investments in blockchain technology. Despite the recent positive trends, the RWA token space faces considerable challenges, with data from CoinMarketCap showing a 7% decline in the market capitalization of RWA tokens.

BlackRock’s Foray Into Crypto

The USD Institutional Digital Liquidity Fund is the latest step in BlackRock’s foray into the digital assets space. The move follows the introduction of BlackRock’s spot Bitcoin ETF, IBIT, in January. Since its launch, IBIT has performed spectacularly and attracted over $15 billion in assets under management.

The firm has also filed for a spot Ethereum ETF with the Securities and Exchange Commission and is quite bullish on crypto and its underlying technology. Larry Fink, BlackRock CEO, recently spoke about the importance of spot Bitcoin and Ethereum ETFs as a precursor to wider adoption of tokenization in the traditional finance industry, adding that such products would help incorporate digital assets into conventional financial practices.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.