BlackRock's tokenized money market fund BUIDL reaches $2.3 billion in assets under management, plans to expand collateral use cases.

BlockBeats news, October 19 - According to Bloomberg, BlackRock, the world's largest asset management company, is exploring expanding the application of tokenized assets from the crypto market to traditional finance, enabling them to serve not only as collateral but also for payments. BlackRock is shifting its focus from issuing stocks, bonds, and money market funds on blockchain networks to improving the transfer methods and collateral uses of these assets. Through tokenization, investors can directly transfer their holdings to other investors or use them as trading collateral without first redeeming them for cash.

BlackRock is also continuously expanding its layout of tokenized products. The company's tokenized money market fund BUIDL, launched in 2024, has seen its assets under management grow to approximately $2.3 billion, and it has since launched related products in the United States and Europe, and in September this year received approval to launch a Hong Kong dollar-denominated digital liquidity fund.

However, the ability of tokenized assets to transfer around the clock on blockchain networks does not mean they can be redeemed for cash at any time. The International Monetary Fund has pointed out that fragmentation between different platforms and legal uncertainties are the main factors hindering the development of tokenized assets. The International Swaps and Derivatives Association (ISDA) also stated that issues such as custody arrangements, collateral rules, and cross-border legal recognition still need to be resolved.

Nikhil Sharma, a director on BlackRock's digital assets team, said that early users of tokenized funds were mainly crypto market participants who wanted to earn yield while holding stablecoins. He added that the key is to establish relevant linkage mechanisms so that traditional financial institutions can use tokenized products without building separate systems, and it is expected that the application scope of related products will further expand over time.