BlackRock's BUIDL Tokenized Fund Surpasses $500M in AUM in Three Months

BlackRock's BLK tokenized fund BUIDL (BlackRock USD Institutional Digital Liquidity Fund) has ammassed more than $500 million in assets under management (AUM) in three months, according to a new report.

BlackRock’s tokenized fund BUIDL (BlackRock USD Institutional Digital Liquidity Fund) has am amassed more than $500 million in assets under management (AUM) in three months, according to a new report by Digift.

As of July 9, 2024, the fund’s AUM reached $502.8 million, which is held across 17 addresses, the report showed.

BUIDL, which is issued on the Ethereum blockchain as an ERC20 token, allows Web3 institutions to access real-world returns without having to navigate the complexities of on-and-off ramp processes.

BlackRock’s collaboration with key Web3 players, including Securitize, Circle, and Ondo Finance, has been crucial in bringing this project to life.

Securitize, which acts as a regulator-recognized transfer agent, enables the use of public blockchains as the primary accounting tool for recording ownership and transfers of issued assets, the report noted.

This partnership has essentially bridged the gap between traditional finance and the blockchain world.

Moreover, Circle’s involvement has introduced a contract to BUIDL that allows for real-time exchanges of BUIDL for USDC.

This feature provides token holders with a level of liquidity that is unmatched, setting a new standard for tokenized funds, according to the report.

Interestingly, Ondo Finance, which is the largest holder of BUIDL tokens, has used this asset to create its own money market fund product, called OUSG.

This multi-layered approach enables stable, real-world returns to flow into the DeFi ecosystem, benefiting a broader range of investors.

The rapid growth of BUIDL is undeniable, and it showcases the strong institutional interest in tokenized financial products.

However, the path to widespread adoption is not without its challenges.

Most jurisdictions are taking a conservative approach to asset tokenization, which presents obstacles like regulatory hurdles and compliance issues.

Despite these challenges, initiatives by BlackRock and other financial giants are highlighting the efficiencies of on-chain interactions, which is encouraging the development of new laws and standards.

As the financial world continues to evolve, the success of BUIDL and similar tokenized funds could pave the way for more traditional institutions to enter the DeFi space.

This trend will likely be a hot topic at Benzinga’s upcoming Future of Digital Assets event, where industry leaders will discuss the implications of such innovations on the future of finance.

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