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BlackRock, the world’s largest asset manager, has applied to launch a tokenized fund, with funds from Fidelity International and HSBC sitting on the blockchain.
BlackRock announced in a filing with the U.S. Securities and Exchange Commission that it has partnered with digital securities issuance platform Securitization Marketplace to launch a tokenized fund, the BlackRock USD Institutional Digital Liquidity Fund.
breaking news: @blackrock has tokenized the BlackRock USD Institutional Digital Liquidity Fund into 100 shares. @Ethereum ERC20 contract👀
Fund: https://t.co/OcQXLoFQaj
SEC filing: https://t.co/27bSZA9OF4
Ethereum contract: https://t.co/p6w8tuzqwa pic.twitter.com/bLxX72L8Ek
— Marty Party (@martypartymusic) March 19, 2024
In a paper, Paul Kremsky, trader and global head of business development at Cumberland, the crypto trading arm of market maker DRW Holdings, notes that in recent years there have been various projects aimed at tokenizing money funds. has appeared, but That’s not the “right” approach.
Paul Kremsky, Cumberland
“This is a highly regulated field, so building these projects correctly will make a big difference,” Kremsky added. “More than any other area of digital assets, this is a niche area that is being targeted by the leading players in TradFi, including asset managers with trillions of dollars in assets under management and the biggest bulwarks. This includes bracket banks.”
Kremsky cited a report from rating agency Fitch and said: At the beginning of 2023, money market funds had $8.4 trillion in assets under management, about six times the market capitalization of all cryptocurrencies.
“If 1.5% of issuance goes on-chain, it will be larger than the current stablecoin market cap,” Kremsky said. “If that 7.5% were to move on-chain, that amount would be larger than Bitcoin.”
Fidelity International Institutional Liquidity Fund
On March 19, 2024, global digital asset banking group Sygnum announced in a statement that it has tokenized its investment in Fidelity International’s $6.9 billion Institutional Liquidity Fund.
Signum invested $50 million in the Fidelity Fund on behalf of its client, Matter Labs. Matter Labs is a software development, engineering, and cryptography company focused on developing scaling solutions for the second largest cryptocurrency, Ethereum.
The investment is the first step in Matter Lab’s long-term strategy to move financial reserves on-chain with institutional custodians like Sygnum, according to a statement.
The banking group said it will issue security tokens on the zkSync blockchain, which represent Fidelity Fund units on-chain and serve as a secure and transparent “proof of reserves” for Matter Lab’s financial reserves. Ta.
Yurg Rimuru, Fidelity International
Fidelity International’s country director for Switzerland, Jürg Riml, said in a statement: “We welcome our partnership with Sygnum Bank, which will expand access for professionals and institutional investors and strengthen the trusted bridge between the emerging digital asset economy and traditional finance.”
According to Signum, the tokenization of real world assets (RWA) grew by 74% to $2.5 billion in 2023.
“Increasing liquidity and accessibility, as well as the increasing attractiveness of traditional yield-bearing products, are driving new levels of transparency, efficiency and the creation of new products in financial markets,” Signum said. added.
HSBC Euro Liquidity Fund
On March 19, 2024, digital securities investment platform moreliquid also announced in a statement that it will tokenize the HSBC Euro Liquidity Fund by introducing the Moreliquid Money Market EUR (MMMEUR) token on the Polygon network.
MMMEUR tokens have monthly coupon payments and can be managed, transferred, or used as collateral for loans, according to moreliquid.
Clement Dody, More Token
“Thanks to the clarity of European regulations regarding the tokenization of financial assets, asset managers are now able to reduce costs and access a wider investor base,” MoreLiquid CEO Clement Dody said in a statement. “They are increasingly turning to digital finance.”
MMMEUR was developed in collaboration with Tokeny and can be purchased directly through your cryptocurrency wallet.
Tokeny CEO Luc Farrepin said in a statement that money market funds are currently in high demand from the buy side, especially on blockchain.
“If successful, we expect a significant influx of assets into blockchain, expanding the market and uncovering promising use cases for the industry,” added Phalenpin.
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