BlackRock, a leading asset management firm, has recently chosen Coinbase as the main infrastructure provider for its tokenized investment fund known as the BlackRock USD Institutional Digital Liquidity Fund (BUIDL). This fund aims to maintain a stable value of $1 per token and distribute daily accrued dividends directly to investors’ wallets in the form of new tokens each month. By investing 100% of its total assets in cash, U.S. Treasury bills, and repurchase agreements, the fund allows investors to earn yield while holding the token on the blockchain.
The development of the BUIDL fund was done in collaboration with the tokenization company Securitize. In a statement made on X (formerly Twitter) on March 21, Coinbase announced that it would serve as an infrastructure provider for the new fund. Despite not disclosing specific details about this role, Coinbase highlighted the partnership as a testament to its commitment to facilitating traditional institutions’ entry into the crypto industry. Coinbase expressed its dedication to bridging the gap between institutions and crypto and showcasing its capacity to deliver the required technology and products to support the rapidly expanding tokenization sector.
Interestingly, Coinbase already maintains a strong business relationship with BlackRock. The cryptocurrency exchange acts as the custodian for BlackRock’s flagship spot Bitcoin exchange-traded fund (ETF) product, IBIT. Additionally, other prominent institutions such as BNY Mellon, crypto infrastructure provider Fireblocks, Anchorage Digital Bank, and digital assets trust company BitGo are also involved in the BUIDL fund.
Community Support and Donations
On-chain data analysis reveals that an Ethereum wallet linked to BlackRock’s BUIDL fund, as identified by blockchain intelligence platform Arkham Intelligence, has received substantial donations from various members of the crypto community. The wallet has amassed over $50,000 worth of memecoins and non-fungible token donations, including popular digital assets like PEPE and lesser-known coins such as ROCK and GAINS. At present, the total value of assets in the wallet is recorded at $100.05 million.
BlackRock’s collaboration with Coinbase for the BUIDL fund signifies a significant step towards incorporating traditional financial institutions into the digital asset space. By leveraging Coinbase’s expertise and infrastructure, BlackRock aims to provide value and yield-generating opportunities to investors while navigating the complexities of the blockchain ecosystem. This partnership underscores the growing interest and adoption of tokenization within the financial industry, paving the way for more innovative investment solutions in the future.