BlackRock’s BUIDL fund now transferable via Circle's USDC contract

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Circle, the US company behind the popular stablecoin USDC, has deployed new smart contract functionality that enables BlackRock USD Institutional Digital Liquidity Fund (BUIDL) holders to transfer their shares to Circle in exchange for USDC almost instantly. The announcement came through a press release on Thursday.

The latest move follows BlackRock’s launch of BUIDL on the Ethereum blockchain last month. Developed in collaboration with Securitize, a frontrunner in the tokenization of real-world assets, the fund aims to provide qualified investors with a novel method to earn US dollar yields by subscribing through Securitize Markets, LLC.

Circle’s smart contract is designed to give BUIDL investors a continuous, 24/7 off-ramp from BUIDL, capitalizing on the benefits of tokenized assets like speed, efficiency, and transparency.

“Tokenization of real-world assets is a rapidly emerging product category. Tokenizing assets is but one important dimension of solving investor pain points. USDC enables investors to move out of tokenized assets at speed, lowering costs and removing friction. We’re thrilled to provide this functionality to BUIDL investors and deliver the core benefits of blockchain transactions via USDC availability to investors,” said Jeremy Allaire, Co-founder and CEO of Circle.

In its first week, BUIDL attracted over $240 million in deposits, with crypto startup Ondo Finance contributing $95 million. Since its launch, the fund has amassed over $288 million, according to data from Etherscan.

In the last 24 hours, data shows that an Ondo wallet conducted a transaction to convert $250,000 BUIDL to USDC. Ondo Finance CEO Nathan Allman confirmed it was a test transaction of Circle’s newly launched functionality.

BlackRock’s BUIDL is tailored for institutional investors, requiring a minimum deposit of $5 million. Nevertheless, it permits RWA projects like Ondo to utilize BUIDL as collateral to cater to their clients.

Circle secured $400 million in a funding round in April 2024 with participants including BlackRock, Fidelity, Marshall Wace, and Fin Capital. Its stablecoin USDC is the industry’s second-largest stablecoin with a market cap of around $32 billion, following Tether’s lead with a market cap of approximately $107 billion, according to data from CoinMarketCap.

Earlier this year, Circle filed for an initial public offering (ICO) with the US Securities and Exchange Commission. Experts said a successful IPO could bring fundamental changes to the stablecoin market, currently dominated by Tether.

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