A recent SEC filing indicates that investment management firm BlackRock is working on a new fund in partnership with Securitize.
The fund, registered in the British Virgin Islands, is a pooled investment fund. To achieve higher returns, investors can combine their funds into a single portfolio.
Securitize is a platform that facilitates the conversion of digital tokens from physical assets such as stocks, bonds and real estate. The partnership with BlackRock shows that the asset manager is committed to tokenization. However, this is not explicitly indicated in the filing.
Minimum investment of $100,000 for BlackRock’s Securitize fund
Tokenization refers to the process of converting real-world assets, such as stocks or real estate, into digital tokens on the blockchain. These tokens represent ownership or value of an asset. This allows for real-time settlement and transparent tracking of assets stored on the blockchain.
According to the filing, the new fund, called the BlackRock USD Institutional Digital Liquidity Fund, requires a minimum investment of $100,000 from outside investors.
Many investment banks are already looking into tokenization. For example, Onyx, the blockchain division of JPMorgan, has developed a proof of concept demonstrating the benefits of tokenization in financial asset management.
BlackRock’s bitcoin ETF fund a major player in the market
In January, BlackRock was one of the first Bitcoin ETFs to be approved for trading, and was quickly among the funds with the most influence. In terms of dominance, this shows the growing interest in Bitcoin as an investment class.
As an indication of the high level of investor activity, by February 27 the value of trading in BlackRock’s Bitcoin ETF fund exceeded $1 billion. By March 1, the iShares Bitcoin ETF fund (IBIT) had reached the top of the ETF industry, with $10 billion in assets under management.
BlackRock CEO predicts tokenization of all financial assets
According to BlackRock CEO Larry Fink, the approval of ETFs marks only the beginning of a transformative change in the financial landscape. Fink told CNBC that ETFs are just the initial step in a broader process of tokenization of every financial asset. He believes that the migration of assets to blockchain will eventually eliminate corruption from the financial system.
