KEY TAKEAWAYS
- BlackRock has launched the largest tokenized treasury fund, BUIDL, on the Avalanche network, marking a significant milestone in tokenized assets.
- The BUIDL fund aims to maintain a stable value of $1 per token, offering daily dividends and investing in cash, U.S. Treasury bills, and repurchase agreements.
- Avalanche’s EVM compatibility and low fees make it a preferred choice for institutional deployments, enhancing its role in the real-world asset market.
- BlackRock’s move aligns with a broader trend of institutional investors exploring blockchain strategies, solidifying Avalanche’s position in digital asset tokenization.
Investment management firm BlackRock has expanded its blockchain footprint by launching the BlackRock USD Institutional Digital Liquidity Fund (BUIDL) on the Avalanche network. The fund, tokenized and accessed through Securitize, is now the largest tokenized treasury fund globally. This launch marks a significant milestone in the growing ecosystem of tokenized assets on Avalanche.
One share of the $500 million-plus fund is represented by one BUIDL token. The fund seeks to maintain a stable value of $1 per token and pays daily accrued dividends directly to investors’ wallets. It aims to invest 100% of its total assets in cash, U.S. Treasury bills, and repurchase agreements, allowing investors to earn yield on otherwise non-yield bearing fiat or stablecoins.
BlackRock’s Strategic Move into Tokenization
BlackRock’s decision to leverage the Avalanche network is part of a broader trend among institutional investors exploring blockchain and digital asset strategies. The fees associated with the share class on Avalanche are notably lower than on some other blockchains. John Wu, President at Ava Labs, commented on the development, stating that tokenization may enable greater access and utility, highlighting the transformative potential of digital financial services like BUIDL.
The deployment of BUIDL on Avalanche underscores the network’s role as a preferred ecosystem for traditional institutions looking to deploy tokenized assets and decentralized applications (dApps) on-chain. Avalanche’s EVM compatibility, sub-second transaction finality, low fees, and robust infrastructure make it an attractive choice for institutional deployments.
Avalanche’s Role in the Real-World Asset Market
Avalanche is playing a critical role in the growth of the real-world asset (RWA) market. The network’s capabilities enable a range of business outcomes, supported by its ecosystem partners’ strategic approach across both crypto-native and non-crypto-native user bases. Carlos Domingo, CEO of Securitize, emphasized the longstanding partnership with Avalanche and the shared vision for the future of finance.
BUIDL’s expansion to Avalanche follows various institutional initiatives, including those by J.P. Morgan, Citi, and asset managers like Wellington and Franklin Templeton, who have incorporated Avalanche into their digital asset strategies. This move further solidifies Avalanche’s position as a leader in the tokenization of real-world assets.
For more information, the official announcement can be found here.
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