BlackRock joins the asset tokenization race with a fresh fund launched on the Ethereum network.

The asset management giant BlackRock announced the launch of a new real-world asset (RWA) tokenization fund on the Ethereum network. Additionally, BlackRock made a strategic investment in the asset tokenization company Securitize.

BlackRock officially introduced the BlackRock USD Institutional Digital Liquidity Fund, represented by the blockchain-based BUIDL token. This fund is fully backed by cash, U.S. Treasury bills, and repurchase agreements, and will distribute yield to token holders via blockchain rails daily, as outlined in a press release. Securitize will serve as the transfer agent and tokenization platform for the fund, while BNY Mellon will act as the custodian of its assets. Notable participants in the fund’s ecosystem include Anchorage Digital Bank NA, BitGo, Coinbase, and Fireblocks.

In addition to launching the tokenized asset fund, BlackRock also disclosed a “strategic investment” in Securitize, although specific terms of the deal were not disclosed. Robert Mitchnick, BlackRock’s Head of Digital Assets, emphasized that this initiative represents the company’s ongoing commitment to developing digital asset solutions to address real client needs, expressing excitement about collaborating with Securitize.

The announcement follows a regulatory filing that revealed BlackRock’s collaboration with Securitize, sparking speculation about a tokenized fund. Notably, BlackRock’s entry into the tokenization field aligns with a broader trend among traditional finance giants, including Citi, Franklin Templeton, and JPMorgan, who have all explored tokenization technology. Tokenization of real-world assets (RWA), such as bonds and funds, has emerged as a rapidly growing use case for blockchain technology, reflecting the increasing integration between digital assets and traditional finance.

BlackRock’s CEO Larry Fink previously indicated in a CNBC interview that the company views its spot BTC ETF as a step towards broader tokenization efforts, underscoring the company’s strategic approach to embracing blockchain technology and digital asset innovation.