TL;DR
- BlackRock and Securitize prepare to launch tokenized fund BUIDL on Avalanche Network.
- The information comes from on-chain activity showing a funded and configured contract.
- This fund is already successfully operating on Ethereum with over $500 million in assets under management.
Asset management firm BlackRock, in collaboration with real-estate asset (RWA) tokenization platform Securitize, could expand its BUIDL fund to the Avalanche blockchain network, according to indications in on-chain activity.
The contract for this fund, which has already shown favorable performance on Ethereum with over $500 million in assets under management, has recently been deployed on Avalanche, and already has an initial funding of one million dollars.
The move appears to align with BlackRock’s interest in expanding its offering of tokenized financial products, allowing greater accessibility to investors through blockchain.
Analyst CryptoNoddy was the first to report on this on-chain deployment in a post on social media network X, where he details that the BUIDL contract address on Ethereum belongs to the same owner as the contract deployed on Avalanche.
1/n Looks like @Securitize, in collaboration with BlackRock, will potentially be launching its tokenized fund (BUIDL) on Avalanche.
Contract is deployed here:https://t.co/0lja0pEjdZ pic.twitter.com/hK2BFLqmZo
— CryptoNoddy (@Crypto_Noddy) November 4, 2024
This coincidence suggests that the expansion of the fund is a well-established plan, although neither BlackRock nor Securitize have made an official announcement so far. It is therefore presumed that this initiative could be in the testing phase and could still take some time to be available to the public.
Avalanche has so far been chosen by several financial institutions to host tokenized products due to its ability to securely and efficiently manage assets. These include tokenized funds from Franklin Templeton and OpenEden, along with other financial products.
With this expansion of BUIDL to an additional network, Avalanche is positioning itself as an increasingly relevant destination for tokenized asset products. Asset tokenization allows for reduced operating costs and provides significant liquidity in the secondary market, which appeals to both investors and large institutions in the financial sector.
Growth potential in tokenized assets with Blackrock
The tokenization of assets like bonds and government-backed securities has gained momentum in recent years, with an estimated current value of $2.34 billion, according to data from Dune Analytics and 21co. Ethereum remains the most popular network for these products due to its maturity and robustness, but networks like Solana, Stellar, and now Avalanche are also capturing some of this growing market.
The tokenized asset sector is expected to continue to expand in the coming years, with growth projections estimating a value of $5 trillion by 2030, according to Citi Bank.
Despite this positive projection, not all players in the sector are completely convinced. Changpeng Zhao, former CEO of Binance, has expressed skepticism about the attractiveness of tokenized assets due to their lower volatility compared to cryptocurrencies.
At a recent investment forum, Zhao noted that low volatility could reduce trading volume in the secondary market, affecting liquidity and ultimately limiting the participation of certain investors seeking quick returns.
Still, growth in demand for tokenized products continues, driven by the security, accessibility, and efficiency advantages that blockchain offers. With the backing of major institutions like BlackRock and advanced network infrastructure like Avalanche, the traditional financial industry and the blockchain ecosystem are increasingly finding points of convergence.
