BlackRock, the World’s Largest Asset, Plans to Tokenize ETF

TLDR

Table of Contents

BlackRock is set to tokenize ETFs following its iShares Bitcoin ETF’s market-leading performance.
The asset manager already runs a $2B tokenized money market fund called BUIDL.
Nasdaq seeks SEC approval to enable trading of tokenized stocks on its platform.
SEC’s Project Crypto supports moving U.S. financial markets onto blockchain systems.

BlackRock, which manages over $9 trillion in assets, is preparing to tokenize its exchange-traded funds (ETFs). This move comes after the strong performance of its iShares Bitcoin Trust (IBIT). The firm now wants to bring traditional investment products like ETFs to blockchain platforms. The aim is to increase efficiency, reduce costs, and offer round-the-clock trading in the future.

BlackRock Expands Blockchain Strategy After IBIT Momentum

Following the launch of its iShares Bitcoin ETF, BlackRock is expanding its interest in blockchain-based products. IBIT has quickly become the largest Bitcoin ETF, attracting billions in investor funds. This success has encouraged BlackRock to explore broader uses of blockchain for financial markets.

According to a report by Bloomberg, BlackRock is actively working on tokenizing a variety of ETFs. These funds would be backed by traditional assets such as stocks. The firm wants to offer these digital versions of ETFs on public or private blockchain networks. This marks a step toward bringing traditional finance closer to blockchain technology.

BlackRock already manages the USD Institutional Digital Liquidity Fund (BUIDL), a tokenized money market fund. This fund was launched in partnership with Securitize and is built on the Ethereum network. BUIDL currently holds more than $2 billion in assets, showing that institutional-grade tokenized products are gaining traction.

Wall Street Firms Show Growing Interest in Tokenized Assets

Other major financial players are also moving toward blockchain adoption. Galaxy Digital recently became the first Nasdaq-listed company to tokenize its common stock. Nasdaq has also filed with the U.S. Securities and Exchange Commission (SEC) to allow trading of tokenized assets on its platform.

The SEC and the Commodity Futures Trading Commission (CFTC) are both reviewing how blockchain could reshape financial markets. One of the key areas under discussion is enabling 24/7 trading—something traditional markets don’t currently support but is standard in crypto.

The SEC recently launched an initiative called “Project Crypto.” This project is aimed at helping U.S. financial infrastructure adapt to blockchain-based assets. While still early, these developments signal increasing institutional interest in tokenized real-world assets.

BlackRock’s involvement could help legitimize this space even more. CEO Larry Fink has previously said that tokenization could bring down costs and make markets more transparent. He called on regulators to support the move, stating that tokenization could benefit both institutions and everyday investors.

Experts See Tokenization as a Long-Term Shift in Finance

Analysts believe that the move toward tokenization is part of a broader trend in financial technology. Bloomberg ETF analyst James Seyffart said the shift to tokenized finance is already happening, although progress may be slow.

“This is likely a decade-long process,” Seyffart said. “Everyone who downplays digital assets has been wrong so far, and the same will happen with tokenization.”

He also pointed to Nasdaq’s recent actions as another example of growing acceptance in the financial sector. Seyffart described these developments as early but important steps toward a larger transition in how markets operate.

While full adoption may take years, the early moves by BlackRock and others suggest that traditional and digital finance may soon overlap. As more firms explore tokenized products, blockchain could become a regular part of how stocks, bonds, and ETFs are issued and traded.

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