BlackRock Advances Real-World Asset Tokenization
At the $ONDO SUMMIT, BlackRock announced it is tokenizing 10% of its supply into gold-backed ($XAUT) and silver-backed ($SLVON) digital assets. The move aims to convert Ethereum transaction fees into valuable assets for DeFi users and Ondo Finance holders, signaling a significant step by a major asset manager into real-world asset tokenization.
- The initiative is formally named the BlackRock USD Institutional Digital Liquidity Fund (BUIDL). It aims to maintain a stable value of $1 per token by investing 100% of its assets in cash, U.S. Treasury bills, and repurchase agreements. - Dividends accrued daily are paid out to investors' digital wallets in the form of new tokens each month. The fund is designed for qualified institutional investors, requiring an initial minimum investment of $5 million. - Securitize acts as the tokenization platform and transfer agent, while BNY Mellon serves as the custodian for the fund's assets. BlackRock also made a strategic investment in Securitize, with its Global Head of Strategic Ecosystem Partnerships, Joseph Chalom, joining Securitize's Board of Directors. - Shortly after its launch, Ondo Finance transferred $95 million of its assets into the BUIDL fund to enable instant settlement for its own U.S. Treasury-backed token, OUSG. - Initially launched on the Ethereum blockchain, BUIDL has since expanded its accessibility to multiple other blockchain networks, including Avalanche, Polygon, Arbitrum, and Optimism. - This move is part of a broader trend among major financial institutions. J.P. Morgan has developed the Tokenized Collateral Network (TCN) through its Onyx division, and Goldman Sachs is creating its own platform to streamline bond issuance. - The market for tokenizing real-world assets is projected to experience significant growth, with Boston Consulting Group estimating it could exceed $16 trillion by 2030. Other forecasts range from $4 trillion to $11 trillion by the same year.
