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    BlackRock expands tokenized money fund across multiple blockchain networks

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    Blackrock is expanding its tokenized money fund, BlackRock USD Institutional Digital Liquidity Fund (BUIDL), across several more blockchain networks including Aptos, Arbitrum, Avalanche, Optimism, and Polygon. The tokenization, handled by Securitize, offers more investors access to US Treasury bills and other low-risk assets. The move will streamline financial transactions and offer opportunities for on-chain yield and dividend distribution. The global market opportunity for such tokenized assets is estimated at $30 trillion. Other firms including Franklin Templeton and FundBridge Capital are also set to launch tokenized money funds.

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    Blackrock, a major asset manager, is set to launch its tokenized money fund on several more blockchain networks, as announced on November 13. This expansion will include networks such as Aptos, Arbitrum, Avalanche (AVAX), Optimism, and Polygon. It’s interesting to note that the initial launch took place on the Ethereum (ETH) network.

    The fund, called the BlackRock USD Institutional Digital Liquidity Fund (or ‘BUIDL’ for short), primarily invests in short-term US Treasury bills and other low-risk options that yield interest. Thanks to Securitize, a company specialized in tokenizing this sort of stuff, BUIDL is now also in the world of digital assets.

    Carlos Domingo, the big man at Securitize, said that these new networks will bring in more investors looking to make complicated processes more efficient by using technology.

    Many are drawn to tokenized versions of real-world assets, like US treasury debt which is estimated to currently be worth around $2.3 billion. BUIDL is leading the pack when it comes to tokenized treasury funds as it manages more assets than any other.

    According to Blackrock, launching on multiple networks allows BUIDL to function within top financial products and infrastructure across various ecosystems. Each of these networks will allow apps and users to engage with BUIDL directly, which is beneficial in a number of ways.

    Let’s say, for example, you want to transfer money to your friend at 3 in the morning, with this setup, you can do so almost instantly, any day of the week. Plus, there’s opportunities for on-chain yield and on-chain dividend accrual and distribution.

    Colin Butler, the head honcho of institutional capital at Polygon, said in August that the global market opportunity for tokenized real-world assets, including everything from T-Bills to works of art, is roughly $30 trillion.

    The US Department of the Treasury’s Q4 2024 report suggests that tokenization could improve things by making it easier to trade Treasury, thanks to reducing what they call ‘operational and settlement frictions’. They also mention that technology like distributed ledger technology (DLT) and smart contracts can be quite handy.

    According to them, this sort of tech could add much needed transparency to Treasury market operations, reduce opacity and provide real-time insight into trading activities for everyone involved.

    Other ambitious players in the market like Franklin Templeton and FundBridge Capital are also launching tokenized money funds, catering to the growing demand in this space.

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