Innovative Step from Injective Blockchain: Tokenized Index for BlackRock’s BUIDL Fund
Injective Blockchain has introduced a new tokenized index for BlackRock’s USD Institutional Digital Liquidity (BUIDL) Fund. This innovation allows investors to access the fund through on-chain financial instruments, marking a significant leap in asset tokenization. The index provides a continuous market that tracks the supply of the BUIDL fund rather than its price. This approach responds to the increasing demand for transparency in fund flows and offers important insights into institutional crypto participation. This significant development has also caused an upward movement in the price of altcoins.
The Announcement of BlackRock’s BUIDL Fund Increased Altcoin Prices
Eric Chen, co-founder and CEO of Injective Labs, emphasized the importance of the index, stating, “Both institutions and individual users now have direct access to a new RWA offering that tracks the real fund led by BlackRock.” The launch of the BUIDL index has positively affected the local token, INJ, with the altcoin price increasing by 14% immediately after the index’s introduction. At the time of writing, the INJ price was trading at $17.18, reflecting an approximate increase of 10.80%.
Price Performance of Injective (INJ)
Source: TradingView
The BUIDL index is traded on Injective’s decentralized exchanges, such as Helix, where investors can use leverage to take long or short positions on the index. The index’s price is adjusted based on changes in the supply of BUIDL tokens using a 1-hour time-weighted average price (TWAP) to reduce volatility caused by significant token movements.
Developments of the BUIDL Fund
The move by the altcoin Injective expands access to the BUIDL fund. Previously, BUIDL, an institutional investment product requiring at least $5 million, had only 18 token holders. The largest token holders owned more than 33% of the fund, which is valued at approximately $178 million. However, now a broader audience has the opportunity to access the BUIDL index with an entry as low as $1. This change aims to democratize access to tokenized assets, potentially reshaping individual investor participation.
As of September, the BUIDL altcoin fund has reached a market value of over $517 million. The fund made a record monthly dividend payment of $2.1 million in July. Through platforms like BlackRock’s BUIDL and Franklin Templeton’s FOBXX, particularly the asset tokenization of U.S. Treasury bonds, significant contributions to the markets have been made with a total value of $2.15 billion.
Tokenized Treasury Market Capitalization
Source: RWA.xyz
This trend indicates a strong interest in real-world asset markets. Additionally, it positions the BUIDL fund as an important indicator of corporate sentiment towards altcoin projects.
