coinculture.com
BlackRock’s increasing involvement in the stablecoin market may accelerate the creation of regulations in the United States, offering a private alternative to a central bank digital currency (CBDC). Crypto investor Ryan Sean Adams noted that BlackRock’s recent introduction of off-ramps in USD Coin for its tokenized fund marks another step toward integrating traditional finance with stablecoin providers.
Adams emphasised that stablecoins will likely become prevalent in the U.S. because major financial players like BlackRock and banks support their development. On April 11, Circle, the issuer of the USDC stablecoin, launched a feature allowing holders of BlackRock’s USD Institutional Digital Liquidity Fund (BUIDL) to exchange their shares for USDC with Circle, providing investors with greater liquidity.
BlackRock is a significant investor in Circle and manages the Circle Reserve Fund. The companies entered a strategic partnership in April 2022 when BlackRock invested in Circle’s $400 million funding round. Adams highlighted that the new BlackRock BUIDL fund on Ethereum serves as a bridge between U.S. Treasuries and USDC, further merging stablecoins with traditional markets.
Adams predicted that banks would integrate themselves into the stablecoin market by partnering with or acquiring crypto-native companies and lobbying for legislation. He argued that the U.S. lacks the political will to create a CBDC and will instead establish one de facto through privately issued stablecoins on public crypto networks like Ethereum.
BlackRock is already a major player in the crypto industry, managing the iShares Bitcoin Trust spot Bitcoin ETF valued at $18.5 billion as of April 10. The asset manager recently launched its tokenized fund, BUIDL, which allows investors to purchase tokens representing shares in a fund that invests in assets such as U.S. Treasury bills.