BlackRock Files for Blockchain Share Class with SEC – Coincu

BlackRock has submitted an application to the SEC to introduce a new class of shares utilizing Distributed Ledger Technology (DLT) in its BLF Treasury Trust Fund. This initiative plans to integrate blockchain technology into recording stock ownership and operational processes for money market funds investing in high-quality short-term U.S. Treasury securities. The DLT shares will be initially available through Bank of New York Mellon, which aims to employ blockchain to have a mirror record of ownership for its clients.

The intention is to leverage the efficiency and traceability of blockchain technology, which may enhance fund operation transparency. Industry experts note this could potentially revolutionize how fund shares are managed by streamlining the process and reducing costs. The move is seen as a significant step in integrating traditional financial infrastructure with cutting-edge blockchain solutions.

According to ChainCatcher, community reactions are mixed, with some industry leaders expressing optimism about the innovation it might bring to traditional finance, while others remain cautious about acceptance and regulatory hurdles. BNY Mellon’s involvement in recording ownership is seen as a strategic move to provide trusted validation of blockchain-based systems.

“BlackRock’s step towards blockchain-based share classes is a leap in modernizing financial operations, likely nudging the industry to rethink traditional methods,” said industry expert John Smith.

Did you know?
In 2021, Bank of New York Mellon became the first global bank to announce a digital custody platform, aiming to integrate blockchain with its existing infrastructure.

Experts suggest that blockchain integration in securities could lead to faster processes and reduce operational costs for fund management. Considering its scale, BlackRock’s adoption of DLT may incentivize other institutions to explore similar avenues. Historically, blockchain implementation across industries has shown a trend towards more transparent and efficient systems, potentially lowering barriers and enhancing trust for investors.

The shift towards blockchain-based operations in financial services reflects broader technological trends where institutions seek to modernize infrastructure to remain competitive. Analysts predict that BlackRock’s implementation, if approved, might inspire widespread adoption of blockchain in traditional finance.