Six weeks after its launch, competitor Franklin Templeton’s tokenized asset fund, BUIDL, from asset management company BlackRock (BLK) surpassed it to become the biggest of its kind on Tuesday.
Blockchain data from rwa.xyz indicates that the BlackRock USD Institutional Digital Liquidity Fund, which is represented by the BUIDL token on the Ethereum (ETH) network and backed by cash, repo agreements, and U.S. Treasury bills, now has $375 million in deposits after receiving $70 million in inflows last week. Since its launch on March 21, the fund—which was developed using the tokenization services platform Securitize—has over 30% of the market.
During the same time frame, there were slight withdrawals from the Franklin OnChain U.S. Government Money Fund with the BENJI token, which caused its assets under management to drop to $368 million.
A major factor in the guard shift was the rise of Ondo Finance (ONDO), whose tokenized Treasury offering, OUSG, utilises BlackRock’s token as a reserve asset and had inflows of $50 million in just one week.
BlackRock’s initial tokenized offering grew quickly because tokenization of real-world assets (RWA), also known as placing traditional assets like bonds and credit on blockchain rails in the form of tokens, has captured the attention of both traditional finance (TradFi) titans and digital asset enterprises. Benefits from tokenization could include increased operational efficiency, greater transparency, and faster, round-the-clock settlements.
U.S. Treasuries, a well-known and low-risk product that allows investors to park their on-chain funds and get predictable yields without having to leave the blockchain environment, have become a doorway for tokenization attempts among RWAs. Early in 2023, the tokenized Treasury market was only about $100 million. However, after BlackRock entered the market, it surged to almost $1.3 billion.