TLDR
- BlackRock plans to tokenize ETFs linked to real-world assets including stocks and bonds.
- Bitcoin and Ethereum ETFs from BlackRock reached $10 billion in AUM within a year.
- BlackRock’s BUIDL tokenized money market fund now manages over $2 billion in assets.
- Tokenized equities remain a small market with less than $500 million in circulation.
BlackRock, the world’s largest asset manager, is reportedly planning to bring exchange-traded funds and other investment products on-chain. The firm is exploring tokenization for funds linked to real-world assets, including stocks and bonds, Bloomberg reported Thursday. The move comes after the firm’s success with its crypto ETFs.
BlackRock’s Bitcoin and Ethereum ETFs each surpassed $10 billion in assets under management within one year, marking them among the first crypto funds to reach that milestone. The firm also manages cumulative inflows of $55 billion for its iShares Bitcoin Trust and $12.7 billion for its iShares Ethereum Trust.
BlackRock Experience with Tokenized Products
BlackRock already has direct experience in tokenized offerings. The BlackRock USD Institutional Digital Liquidity Fund, known as BUIDL, became the first tokenized fund to cross $1 billion in March and now manages over $2 billion.
These products give the firm experience in managing digital assets within a regulated framework.
In addition, BlackRock offers thematic ETFs, such as the iShares Blockchain and Tech ETF, which invest in companies involved with crypto technology. These funds focus on company equities rather than tokens directly.
Industry Moves Toward Tokenization
Interest in tokenization is growing across Wall Street. Fidelity recently launched a blockchain-based version of a Treasury money market fund, linked to the Fidelity Digital Interest Token. Nasdaq has also filed with the U.S. Securities and Exchange Commission to allow trading of tokenized stocks alongside traditional equities.
Analysts note that tokenized ETFs and equities are still a small market. RWA.xyz reports less than $500 million worth of tokenized securities are in circulation. Some platforms, including Robinhood and Kraken, offer on-chain versions of popular U.S. equities such as TSLA and AAPL.
Market and Regulatory Context
BlackRock CEO Larry Fink has repeatedly expressed support for tokenization. He stated that all financial assets could eventually be tokenized, which may reduce institutional costs and improve market efficiency.
The SEC has signaled openness to tokenization through initiatives like Project Crypto, which explores on-chain trading and 24/7 market operations similar to cryptocurrency markets.
While experts note that tokenization may improve operational efficiency, the consumer adoption of tokenized ETFs remains uncertain. Bloomberg analyst Eric Balchunas wrote on X that tokenization may offer minor benefits to back-office processes but is unlikely to change investor behavior immediately.
