BlackRock Explores Bringing ETFs to Blockchain, Expanding Beyond Treasuries

The world’s largest asset manager is exploring ways to put exchange-traded funds (ETFs) on blockchain, according to sources familiar with the matter who spoke to Bloomberg.

BlackRock is considering tokenizing funds tied to real-world assets, including stocks, though any launch would require regulatory approval, the sources added.

This initiative follows the firm’s first foray into tokenization last year with the BlackRock USD Institutional Digital Liquidity Fund (BUIDL). Backed by short-term U.S. Treasuries, repurchase agreements, and cash, BUIDL has grown into the world’s largest tokenized Treasury product, managing nearly $2.2 billion.

Tokenizing ETFs would mark a significant step deeper into blockchain-based financial products. Under such a model, ETF shares — traditionally traded on stock exchanges during set market hours — could be issued and transacted as digital tokens on-chain.

Proponents say tokenized ETFs could offer several advantages: 24/7 trading, near-instant settlement compared with the typical two-day process in traditional markets, and greater access for investors in regions where ETFs are not widely available.

The products remain subject to regulatory approval. BlackRock’s exploration highlights a broader trend in the financial industry, as banks, fintech firms, and asset managers increasingly test blockchain technology for bonds, private credit, and now mainstream equity funds.