BlackRock’s Ethereum-based BUIDL fund has amassed $245 million in Ethereum tokens within just one week since its launch. Etherscan data reveals that ten transactions have contributed to the BlackRock USD Institutional Digital Liquidity Fund, starting with an initial $5 million on March 20 when the BUIDL fund debuted.
In the subsequent seven days, an influx of $239.8 million poured into the ERC-20-based fund, inclusive of $92 million in Ondo Short-Term US Government Treasuries from Ordo Finance, a platform tokenizing real-world assets.
Ordo Finance expressed enthusiasm regarding BlackRock’s adoption of securities tokenization with BUIDL’s launch, emphasising the collaborative effort with various ecosystem participants. They stated, “Not only does this further validate our original concept of a tokenized US Treasury fund, but it also bolsters our thesis that tokenization of traditional securities on public blockchains represents the next major step in the evolution of financial markets.”
Ondo Finance has allocated $95M of OUSG’s assets into @BlackRock’s BUIDL, as the tokenized fund draws $240M since its debut.
— Ondo Finance (@OndoFinance) March 27, 2024
Though not classified as a stablecoin like USDT or USDC, BlackRock clarified that BUIDL’s value is designed to maintain parity with the U.S. dollar at a 1:1 ratio. Cryptocurrency stablecoins aim to provide stability in the volatile cryptocurrency market and facilitate exchanges with fiat or other tokens.
BlackRock specified that the fund allocates 100% of its assets to cash, U.S. Treasury bills, and repurchase agreements.
Documentation for the BlackRock USD Institutional Digital Liquidity Fund, based in the British Virgin Islands, was filed with the U.S. Securities and Exchange Commission on March 14. This development reignited hopes for an Ethereum ETF, despite the SEC’s resistance to BlackRock’s iShares Ethereum Trust ETF.
The SEC also postponed a decision on Grayscale’s Ethereum ETF until the end of May.
Based on data from the Real-World Assets (RWA) platform, BlackRock’s BUIDL holds the second position after Franklin Templeton’s Franklin OnChain U.S. Government Money Fund, with a market capitalization of $360.2 million. The Ethereum-based BlackRock BUIDL fund’s market capitalization stands at $106.5 million.
BlackRock CEO Larry Fink, speaking to CNBC in January, advocated for crypto-based exchange-traded funds following the SEC’s approval of the first Bitcoin ETFs. He mentioned, “I see value in having an Ethereum ETF,” emphasising their role as stepping stones towards tokenization.
While there is considerable interest in an Ethereum spot ETF, its appeal may not reach the levels witnessed by Bitcoin ETFs, which garnered $4.5 billion on their debut day.
