BlackRock Files With SEC to Digitize $150B Money Market Fund Using Blockchain

• BlackRock has filed with the US Securities and Exchange Commission (SEC) to launch DLT Shares of its $150 billion portfolio. 
• The minimum investment plan for DLT Shares is set at $3 million for institutions with no minimum requirements for subsequent investment.

BlackRock has taken a strategic decision to create a digital share class (DLT Shares) for its $150 billion Treasury Trust money market fund. According to the information disclosed by Bloomberg ETF analyst Henry Jim, this would use “blockchain technology to mirror ownership in potential preparation for digital currency or digital cash application,” and would be done by the Fund’s exclusive distributor, BNY Mellon.

According to experts, this could pave the way for broader adoption of tokenized cash, digital assets, etc.

Although the Fund does not currently employ blockchain technology or invest in crypto assets, … [BNY] intends to use blockchain technology to maintain a mirror record of share ownership for its customers.

Research also shows that BlackRock’s Liquidity Treasury Trust Fund forms part of its Liquidity Funds suite. The proposed DLT Share class is expected to have a minimum investment requirement of $3 million for institutional investors.

According to the report, there is no minimum requirement for subsequent purchases. However, this proposal is awaiting the approval of the US Securities and Exchange Commission (SEC).

Previous Tokenization Interest by BlackRock

BlackRock has consistently shown interest through large-scale moves into tokenization due to its enormous potential.

In March, its CEO, Larry Fink, highlighted in a letter to shareholders that tokenized funds would rise in popularity and attain the same height as Exchange Traded Funds (ETFs). However, he explained that the industry would first have to create a better infrastructure for digital identities. As explained earlier in our blog post, Fink highlighted that technology could ensure that wider access is opened while speeding up trade and democratizing investment.

Every stock, every bond, every fund— every asset—can be tokenized. If they are, it will revolutionize investing. If we’re serious about building an efficient and accessible financial system, championing tokenization alone won’t suffice. We must solve digital verification, too.

BlackRock is not the only firm that has experimented with the creation of a blockchain-based representation of Real World Assets (RWA). Recently, Libre announced its decision to tokenize $500 million of Telegram’s debt, which is estimated to be around $2.4 billion.

Last year, the asset manager disclosed that it is expanding its BlackRock USD Institutional Digital Liquidity Fund (BUIDL) beyond Ethereum to five more blockchains – Aptos, Arbitrum, Avalanche, Optimism’s OP Mainnet, and Polygon networks.

In March, its BUIDL surpassed $1 billion on Ethereum, as discussed earlier. According to that report, this was largely driven by the influx of funds from crypto protocol Ethena. As detailed in our recent news coverage, Sky is also planning to allocate around $500 million to BUIDL.