BlackRock Explores Tokenizing ETFs After Prosperous Bitcoin and BUIDL Launches
BlackRock is considering a new move in the world of digital finance—tokenizing exchange-traded products.
This plan comes after the success of its Bitcoin ETF and tokenized money market fund, BUIDL. Tokenized ETFs could offer around-the-clock trading and new ways to use funds as collateral.
tokenized ETFs would represent traditional assets like stocks but use blockchain technology. This allows trading at any time and makes it easier for international investors. It also opens up new possibilities for using these funds in crypto networks.
BlackRock has done well with tokenization so far. Its BUIDL fund reached over $2 billion in assets since launching last March. The company’s Bitcoin ETF hit $10 billion in assets within a year.
CEO Larry Fink views tokenization as crucial for the financial industry. He believes every asset can eventually be tokenized to improve efficiency.
- BlackRock uses blockchain for some trades.
- Regulatory challenges exist for tokenized ETFs.
- However, U.S. policymakers are becoming more open to testing blockchain markets.
Nasdaq recently filed with the SEC to trade tokenized stocks.Other asset managers and trading platforms are also working on similar projects.
The market for tokenized assets is still small today but shows promise. It’s currently worth around $29 billion, compared to the much larger U.S. ETF industry.
