BlackRock’s BUIDL: A guide to tokenized yield-bearing funds
Tokenized real-world assets (RWAs) are one of the fastest-growing niches in the crypto world. RWAs allow institutional entities to bring various traditional finance (TradFi) assets to an on-chain environment. These may include commodities, equities, bonds, cash equivalents and more. According to DefiLlama, the total value locked (TVL) in RWAs already stands at $11 billion as of early April 2025, and a clear leader of this niche has emerged by now in the form of BlackRock’s tokenized money market fund, BUIDL.
Launched in March 2024 by the world’s top asset manager, BUIDL has already amassed a TVL over $2 billion as of the time of this writing (Apr 15, 2025). In this article, we’ll take a closer look at this category leader launched by BlackRock via Securitize, a major provider of RWA tokenization services.
Key Takeaways:
BlackRock USD Institutional Digital Liquidity Fund (BUIDL) is a tokenized money market fund represented on-chain via the BUIDL yield-bearing stablecoin.
Initially launched on Ethereum (ETH), BUIDL has expanded to numerous other major chains, including Solana (SOL), Aptos (APT), Arbitrum (ARB), Avalanche (AVAX), Optimism (OP) and Polygon (POL).
What is Blackrock's BUIDL?
The BlackRock USD Institutional Digital Liquidity Fund (BUIDL) is a tokenized money market fund launched in March 2024 by BlackRock, Inc., the world’s largest investment management firm by assets under management (AUM). The New York–based behemoth of the investment finance world launched the fund via Securitize, one of the leading providers of asset tokenization.
BUIDL invests in short-term cash and cash equivalent assets, such as Treasury bills, certificates of deposit and commercial paper. It may suit investors who’d like to use their spare cash for low-risk and quick — even if modest — returns.
BUIDL was initially launched on the Ethereum blockchain. By the end of 2024, it had expanded to several more chains, including Aptos (APT), Arbitrum (ARB), Avalanche (AVAX), Optimism (OP) and Polygon (POL). A year after its launch, in March 2025, the fund also added Solana (SOL) to its list of host blockchains.
As of Apr 15, 2025, BUIDL has accumulated a TVL of around $2.37 billion, making it the largest asset in the RWA category as defined by the DefiLlama portal. This figure represents nearly 20% of the category’s total TVL of $11 billion.
Source: DefiLlama.com
How does BUIDL work?
BUIDL was tokenized and launched as a USD-pegged stablecoin. Investment in the fund delivers daily accrued dividends. As such, BUIDL operates as a yield-bearing stablecoin. Besides providing rate stability, these stablecoins regularly accumulate rewards for investors. The rewards, however, aren't added to each unit of BUIDL held, as the stablecoin itself has a fixed rate of $1 at all times. The accrued dividends are paid out separately in BUIDL tokens to investors every month.
Unlike many other stablecoins, BUIDL isn't traded on the crypto market. In essence, it acts as a certificate of your investment in the fund.
Investing in BUIDL is possible exclusively via Securitize. The minimum investment amount is $5 million, and the fund is open to Qualified Purchasers. Under US securities law, Qualified Purchasers are entities, such as individuals and family offices, who have at least $5 million in investments.
Benefits of BUIDL
BUIDL boasts a number of significant benefits, including the following:
Low risk. The financial assets underpinning the fund have low risk profiles, ensuring that your investment is safe even during periods of market volatility and significant bear markets.
Backing by BlackRock. In the crypto industry, including its RWA corner, scams and low-quality providers are a serious issue. Because the BUIDL fund is being offered and backed by none other than BlackRock, investors can be certain of the product’s high standard and security.
Daily yield accumulation. The BUIDL fund earns low-risk yields daily, meaning that your money works for you virtually around the clock.
Highly stable principal investment in the form of the BUIDL stablecoin. Your principal’s stable value is guaranteed by the operational mechanism of the BUIDL coin. BUIDL's rate might theoretically deviate from $1, but since the coin isn't tradable on the secondary market, it maintains some of the tightest pegs to the greenback among all stablecoins. In fact, since its launch date, BUIDL has maintained a rate of exactly $1 at all times (as of mid-April 2025).
Blockchain-based and available across multiple popular chains. This benefit is for true crypto natives, who may want to invest in a quality, institutional-grade product while keeping their funds on-chain.
BUIDL might have applications as a collateral asset. Using BUIDL as collateral on participating platforms may even deliver better yields than using other stablecoins for collateralization.
Flexible and quick redemption process. Since BUIDL is a tokenized money fund, BUIDL holders can quickly redeem their investment at a rate of 1:1 to the US dollar. Moreover, its blockchain-based structure allows users to seamlessly convert their BUIDL to USD via the supported blockchains. Redemption requests are processed daily, offering more flexibility than the lengthy and often rigid redemption periods associated with many TradFi assets.
Risks of BUIDL
Despite its numerous merits, investment in the BUIDL fund carries certain risks:
Yield volatility. While the assets are low risk, yield may still fluctuate based on the performance of the underlying financial instruments, such as Treasury bills and certificates of deposit (CDs).
Regulatory risks. As of April 2025, the US still lacks a comprehensive framework that regulates crypto assets and products at the federal level. Thus, any tokenized financial product, including BUIDL, could face potential regulatory challenges in the future. Given BlackRock’s solid record and reputation, the risk of such challenges may not be high at all, but it does exist — at least until more certainty is brought to the field by the country’s lawmakers.
Platform risks. While blockchains are known for their cryptographic security features, hacks and network outages may happen even on the most popular chains. Any tokenized asset — and the BUIDL stablecoin is no exception — always has such platform risks associated with it.
Closing thoughts
For high–net worth individuals and institutional investors, BUIDL represents a great alternative to traditional money market funds. Its blockchain-native nature will certainly appeal to any investor who'd like to keep their assets on-chain while enjoying the security and regular yields provided by the investment titan BlackRock.
As the niche of tokenized treasuries gains momentum, we may see similar products launched by major TradFi players. For now, BUIDL represents one of the rare options for tokenized money market fund investors, and its niche-leading TVL confirms that the market has enthusiastically embraced this novel product.
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