Securitize and Elixir Unlock DeFi Potential for BlackRock’s Tokenized Fund, BUIDL

n a groundbreaking move, Securitize and Elixir have launched decentralized finance (DeFi) vaults for BlackRock’s tokenized money market fund, BUIDL, enabling holders to access DeFi opportunities while earning interest from U.S. Treasury bills. The initiative marks a significant step forward in bridging traditional finance with the crypto ecosystem.

Introducing sBUIDL and DeFi Vaults

The new offering, announced on Nov. 19, introduces liquid staking tokens (LSTs) for tokenized securities, including BlackRock’s on-chain money fund. Designed by Elixir, a blockchain network for crypto exchanges, the deUSD RWA Institutional Program aims to unlock enhanced yield opportunities for over $1 billion in real-world assets (RWAs) issued by Securitize.

The DeFi vaults, built on the Ethereum network’s ERC-4626 token standard, provide seamless access to decentralized financial products using deUSD as the primary currency. Holders of BUIDL can now deposit their assets into the vaults, mint LSTs called sBUIDL, and utilize these tokens across DeFi platforms — all while continuing to earn yields from the underlying U.S. Treasury bills.

Expanding Opportunities in Tokenized Assets

BUIDL, tokenized by Securitize, represents BlackRock’s USD Institutional Digital Liquidity Fund. This money market fund focuses on low-risk investments such as short-dated U.S. Treasury bills, providing a stable income stream for investors.

“With $1 billion in RWA liquidity unlocked, BUIDL holders can now access a wide array of DeFi opportunities without sacrificing the yield from their Treasury-based holdings,” RWA.xyz, an RWA-focused database, highlighted in an X post.

Market Impact and Demand Surge

Demand for tokenized RWAs, particularly those offering low-risk yields from Treasury bills, is skyrocketing. As of Nov. 19, tokenized U.S. Treasury debt commands approximately $2.4 billion in total value locked (TVL), according to RWA.xyz. BlackRock’s BUIDL leads the market with the largest assets under management (AUM), followed by the Franklin OnChain US Government Money Fund.

Carlos Domingo, CEO of Securitize, highlighted the growing interest in tokenized assets, stating:

“These new integrations will attract more investors seeking to leverage blockchain technology to improve efficiency in areas traditionally hindered by operational challenges.”

The Path to Multichain Expansion

BlackRock has also emphasized the importance of expanding BUIDL across multiple blockchain ecosystems, enabling its use within leading blockchain-based financial products and infrastructure. This multichain strategy further integrates tokenized assets into the broader DeFi landscape.

Tokenization is being recognized as a transformative force in traditional financial markets. Colin Butler, global head of institutional capital at Polygon, estimates the tokenized asset market could represent a $30 trillion global opportunity across diverse asset classes, including Treasury bills and artworks.

The U.S. Department of the Treasury echoed this sentiment, noting in its Q4 2024 report that tokenization could significantly enhance Treasury liquidity by reducing operational and settlement frictions.

A Step Toward the Future of Finance

Securitize and Elixir’s partnership for BlackRock’s BUIDL fund demonstrates the growing convergence between traditional finance and blockchain technology. By unlocking DeFi opportunities for tokenized RWAs, the collaboration sets the stage for a more efficient and accessible global financial system.

Stay tuned as we continue to track the evolution of tokenized finance and its impact on the broader market.