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- BlackRock’s blockchain-based money market fund, BUIDL, is now available on Solana, expanding beyond its initial Ethereum launch.
- Blockchain’s 24/7 operations enable real-time liquidity and trading, offering more flexibility compared to traditional money market funds with limited business hours.
- BlackRock’s expansion signals a broader trend in financial institutions embracing blockchain and tokenization to streamline traditional investment vehicles.
BlackRock, a world-leading asset management company, is bringing its blockchain-based money market fund, BUIDL, to Solana. Its tech partner, Securitize, made the announcement on Tuesday. The move comes after BlackRock launched its USD Institutional Digital Fund in 2024 and is the latest in the company’s continued experimentation with tokenized assets and blockchain technology.
BUIDL, which combines traditional money market funds with the advantages of blockchain, offers a novel solution for investors to park funds and earn yield. Money market funds have been conventional short-term investment funds offering low risk and stable returns. Such funds, however, have limited operating hours traditionally, decreasing the level of flexibility for investors. Blockchain, by contrast, is a 24/7 platform, enabling enhanced transparency, efficiency, and real-time liquidity.
Initially launched on Ethereum, BUIDL is now available on seven blockchains, with Solana being the most recent. The fund has already amassed $1.7 billion in assets, including cash and Treasury bills, and is on track to surpass $2 billion by early April, according to Securitize. The expansion into Solana is expected to bring even greater access to an even broader base of investors, especially given Solana is renowned for its scalability and fast transaction speeds.
Blockchain Revolutionizing Investment Vehicles
Michael Sonnenshein, COO of Securitize, emphasized the role of blockchain in transforming traditional investment vehicles. “We’re making them unboring,” Sonnenshein said, referring to how blockchain technology removes traditional barriers. He explained that blockchain’s decentralized nature allows traders to conduct instantaneous trading and transfers, unlike traditional funds, which limit transactions to business hours. In an era where crypto markets operate around the clock, this flexibility is crucial for investors who need to move funds swiftly, especially in fast-paced environments.
The expansion of BlackRock’s BUIDL fund is an element of a broader trend across the financial sector toward tokenization. Tokenization is the trend of taking off-chain assets—such as stocks, bonds, and real estate—onto blockchain networks. This approach not only makes transactions faster but also more transparent and efficient, reducing the friction built into conventional financial systems. BlackRock’s move is seen as a signal that large financial institutions are embracing blockchain’s potential to revolutionize investment products.
This is not a new trend at BlackRock. Other financial behemoths such as Franklin Templeton have already launched their own blockchain-based money market funds, and Figure Markets just received approval from the SEC to provide an interest-bearing stablecoin. These moves attest to the growing interest in the ability of blockchain to streamline traditional financial instruments.
BUIDL Offers Stability and Yield for Crypto Traders
For crypto traders, stablecoins like USDT and USDC have been a sanctuary of safety during periods of market volatility. While these stablecoins offer price stability, they do not earn yield. BUIDL, on the other hand, is looking to offer both yield and security, which will make it a desirable choice for those who are looking for passive income without sacrificing safety.
Lily Liu, president of Solana Foundation, described her vision for on-chain finance: “Our vision for why on-chain finance adds more value is because you can do more things with those assets on chain than you could if they’re sitting in your brokerage account.” The combination of traditional assets and blockchain technology opens up a new universe of possibilities, making financial services more accessible, flexible, and efficient.
As additional institutional players like BlackRock enter the blockchain space, the intersection between crypto and traditional finance continues to evolve, paving the way for a future where tokenized assets and digital funds will play an increasingly leading role in the world’s financial markets.
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