Why BlackRock Invested $47 Million in This RWA Tokenization Firm

BlackRock has spearheaded a $47 million investment round for Securitize, a firm focused on tokenization of real-world assets (RWA).

Announced on May 1, this strategic infusion of capital marks a crucial step in the evolution of digital asset securities.

How Securitize Plans to Use $47 Million Funding

Securitize is set to use this funding to propel product development, expand internationally, and enhance partnerships across the financial industry. Investors in this round include Hamilton Lane, ParaFi Capital, and Tradeweb Markets, alongside other key players such as Aptos Labs, Circle, and Paxos.

“In our view, the transformative potential of blockchain technology to reshape the future of finance in general – and tokenization in particular – is promising,” Carlos Domingo, the co-founder of Securitize said.

Consequently, Joseph Chalom, BlackRock’s Global Head of Strategic Ecosystem Partnerships, will join the Securitize Board of Directors.

“At BlackRock, we believe that tokenization has the potential to drive a significant transformation in capital markets infrastructure. Our investment in Securitize is another step in the evolution of our digital assets strategy,” Chalom said.

In March, BlackRock partnered with Securitize to launch its first tokenized fund on Ethereum, the BlackRock USD Institutional Digital Liquidity Fund (BUIDL). This fund offers a stable $1 value per token and distributes dividends directly to investors’ wallets as new tokens monthly.

Investing primarily in cash, US Treasury bills, and repurchase agreements, the fund aims to provide yield while maintaining liquidity on the blockchain.

Importantly, BeInCrypto reported that BUIDL has become the world’s largest treasury fund tokenized on a blockchain as of May 1. It surpassed Franklin Templeton’s Franklin OnChain US Government Money Fund in market capitalization.

Since its launch six weeks prior, BUIDL has swiftly attracted market attention, with its market capitalization skyrocketing from $274 million to $375 million in April, an impressive 36.5% increase.

This surge aligns with a wider trend towards debt-based, high-yield investments. As of April 26, the total value locked in tokenized real-world assets reached a record $8 billion, marking a nearly 60% rise since February.

These statistics exclude fiat-backed stablecoins and cover various assets, including commodities, securities, and real estate tokenization protocols.