BlackRock is preparing its next big step in digital finance with plans to tokenize exchange-traded products.
Summary
- BlackRock is weighing tokenized ETFs after the success of its spot Bitcoin ETF and tokenized money market fund, BUIDL.
- Tokenized ETFs could enable 24/7 trading, fractional ownership, and new collateral use cases in crypto markets.
- Regulatory and infrastructure hurdles remain, but the move signals traditional finance’s deeper embrace of blockchain.
BlackRock is weighing plans to tokenize ETFs, expanding its push into blockchain-based investment products after the success of its spot Bitcoin (BTC) ETF and tokenized money market fund. The news was reported by Bloomberg on Sept. 11, citing people familiar with the matter.
Tokenization push beyond BUIDL and Bitcoin ETF
The world’s largest asset manager is exploring how to issue ETFs tied to real-world assets, such as stocks, as blockchain-based tokens. Tokenized ETFs would allow investors to trade outside Wall Street’s limited hours, enable easier access for international markets, and potentially unlock new uses for the funds as collateral in crypto networks.
BlackRock has prior experience in this field. Since its March 2024 launch, its tokenized money market fund, BUIDL, has amassed assets of over $2 billion, making it one of the most popular tokenized funds available. Within a year, the company’s spot Bitcoin ETF, iShares Bitcoin Trust, surpassed $10 billion in assets under management, making it one of the fastest-growing funds of its kind.
In his 2025 investor letter, CEO Larry Fink once again highlighted tokenization as the financial industry’s future, stating that “every financial asset can be tokenized” to increase settlement efficiency and speed. BlackRock has also used trades on JPMorgan’s Onyx platform, now known as Kinexys, to test blockchain settlement infrastructure.
Regulatory hurdles and market implications
Tokenized ETFs still face obstacles despite their increasing popularity. While blockchain-traded assets move instantly and around the clock, traditional ETFs settle through clearinghouses. For regulators, custodians, and exchanges, reconciling these systems continues to be a significant challenge.
Still, the environment is shifting, with U.S. policymakers under the Trump administration signaling openness to sandbox-style programs that let firms pilot blockchain-based markets.
Nasdaq has already filed with the Securitoes and exchange-commission to allow tokenized stocks to be traded on its exchange, which could mark the first major test of blockchain inside U.S. equity markets.
Meanwhile, other asset managers like Franklin Templeton and Fidelity are developing tokenized funds, and trading platforms such as Kraken and Robinhood have offered tokenized equities overseas.
The tokenized asset market is still small, around $29 billion in value, according to data from RWA tracker rwa.xyz, compared to the $8 trillion U.S. ETF industry.
