BlackRock’s BUIDL Fund Sets Record with $2.1 Million in July Dividends
BlackRock’s USD Institutional Digital Liquidity (BUIDL) fund made headlines in July as it paid out a record-high dividend of over $2 million, marking its highest monthly payout to date. Etherscan data revealed that BlackRock distributed $2.12 million to investors in July, showing a 16% increase from the previous month. Since its launch, the fund has distributed more than $7 million in dividends, with returns steadily climbing each month.
Explosive Growth of BUIDL Fund
Launched on the Ethereum blockchain in March, BUIDL has rapidly gained traction in the market. With a market capitalization of around $522 million, the fund has outpaced established counterparts like Franklin Templeton’s Franklin On-Chain U.S. Government Money Fund (BENJI). Deloitte noted that the surge in BUIDL dividend payouts reflects institutional investors’ growing favoritism towards tokenized money market funds. These funds offer increased liquidity, accessibility, and efficiency compared to traditional alternatives. Additionally, decentralized finance protocols like Temperature utilize BUIDL for derivative development.
Tokenized U.S. Treasury Market on the Rise
The tokenized U.S. Treasury market witnessed significant growth in 2024, with its total value surging from $726.23 million to $1.88 billion. Key players such as BlackRock’s BUIDL and Franklin Templeton’s FOBXX have played pivotal roles, boasting market capitalizations of $522.81 million and $414.3 million, respectively. Analysts predict that this upward trajectory will continue, with the market projected to reach $3 billion by the year’s end. The surge in demand stems from decentralized autonomous organizations (DAOs) and decentralized finance (DeFi) initiatives seeking stable, low-risk returns within the blockchain ecosystem. Consulting firm McKinsey anticipates the tokenized financial assets market to hit $2 trillion by 2030.
The Future of Tokenized Assets
Risk-weighted asset tokenization involves converting physical assets like bonds, real estate, and debt into digital tokens on a blockchain network. These digital representations can be traded, transferred, and utilized within the decentralized finance ecosystem. Hamilton co-founder and CEO Mohamed Elkastawi emphasized the potential of RWA tokenization to introduce greater transparency, liquidity, and accessibility to traditional financial markets. The democratization of access to quality investment opportunities through fractional ownership and 24/7 liquidity is a key benefit.
BlackRock is paving the way in the world of cryptocurrency asset management, offering Bitcoin spot ETFs and Ethereum spot ETFs, with the latter hitting the market on July 23. Chief Investment Officer Samara Cohen recently hinted that while Bitcoin and Ethereum funds are in focus, the immediate future may not see the addition of funds based on other cryptocurrencies.
