Key Takeaways
- • BlackRock sees tokenized money market fund shares eligible as collateral for trades in traditional financial markets, according to an October 19 Bloomberg report quoting Dan Maley, the firm's head of cash management for Asia Pacific.
- • BlackRock's BUIDL fund already serves as off-exchange collateral for institutional traders on Binance, a crypto-market precedent established through a Securitize arrangement announced in November 2025.
- • BlackRock's August 2026 European tokenization rollout, built on JPMorgan's Kinexys platform, covers money market fund ranges with combined assets under management of USD 311 billion, though this figure does not represent the value of tokenized shares.
- • No traditional clearinghouse agreement or collateral launch for tokenized BlackRock funds has been identified, and the shift from crypto-market collateral to conventional markets still depends on custody, clearing and collateral eligibility rules.
- • Ondo launched three BlackRock-strategy Intelligent Portfolios on September 24, 2026, offering economic exposure rather than direct ETF ownership, with no collateral acceptance identified.
Summary
BlackRock has identified the use of tokenized investment funds as trading collateral in traditional financial markets as a potential next application for blockchain technology. According to an October 19 Bloomberg report, Dan Maley, BlackRock's head of cash management for Asia Pacific, said the firm's tokenized funds are already used as collateral in digital-asset markets, and that extending this capability into conventional finance remains more complicated. The appeal for investors is the ability to pledge fund holdings to support a trade without first redeeming them for cash, preserving continuing exposure and access to fund income, subject to the collateral arrangement, product terms and the holding institution.
The firm's crypto-market precedent is its USD Institutional Digital Liquidity Fund (BUIDL), launched in 2024 and issued using Securitize's infrastructure. In November 2025, Securitize announced that Binance would accept BUIDL as off-exchange collateral for eligible institutional traders, allowing participants to support trading while retaining exposure to the underlying short-term Treasury investments. Eligibility depends on the exchange, custody service, client classification and product restrictions, so not every BUIDL holder can pledge shares against any position.
BlackRock's broader cash management tokenization expanded in Europe in August 2026. In an August 4 announcement, the firm said tokenized share classes for selected Institutional Cash Series money market funds, built on JPMorgan's Kinexys platform and using Ethereum-based tokens, now cover fund ranges with combined assets under management of USD 311 billion. The company stated that the official shareholder register continues to operate through traditional transfer-agent infrastructure, and it identified treasury management, liquidity management, digital collateral and institutional distribution as potential uses. The rollout includes sterling, euro and US dollar share classes.
BlackRock's work with Ondo Finance adds another channel. Ondo introduced three Intelligent Portfolios on September 24, 2026, based on BlackRock-developed strategies (high-income, diversified-growth and high-growth), available to eligible non-US investors in permitted jurisdictions. Each token provides economic exposure to a portfolio rather than direct ownership of the underlying ETFs, and no collateral agreement for these portfolios has been identified.
Significant hurdles remain before tokenized fund shares can secure conventional trades. Banks and clearing organizations set their own eligibility standards, valuation methods and default-handling procedures, and must determine how legal ownership and settlement finality operate alongside fund documents. Tokenized money market funds also retain their redemption procedures, permitted-investor restrictions and portfolio risks. The October 19 report did not identify a completed agreement with a traditional clearinghouse or specify which BlackRock fund would be accepted next, and BlackRock did not disclose the amount of European fund tokens currently pledged against transactions.
The firm's crypto-market precedent is its USD Institutional Digital Liquidity Fund (BUIDL), launched in 2024 and issued using Securitize's infrastructure. In November 2025, Securitize announced that Binance would accept BUIDL as off-exchange collateral for eligible institutional traders, allowing participants to support trading while retaining exposure to the underlying short-term Treasury investments. Eligibility depends on the exchange, custody service, client classification and product restrictions, so not every BUIDL holder can pledge shares against any position.
BlackRock's broader cash management tokenization expanded in Europe in August 2026. In an August 4 announcement, the firm said tokenized share classes for selected Institutional Cash Series money market funds, built on JPMorgan's Kinexys platform and using Ethereum-based tokens, now cover fund ranges with combined assets under management of USD 311 billion. The company stated that the official shareholder register continues to operate through traditional transfer-agent infrastructure, and it identified treasury management, liquidity management, digital collateral and institutional distribution as potential uses. The rollout includes sterling, euro and US dollar share classes.
BlackRock's work with Ondo Finance adds another channel. Ondo introduced three Intelligent Portfolios on September 24, 2026, based on BlackRock-developed strategies (high-income, diversified-growth and high-growth), available to eligible non-US investors in permitted jurisdictions. Each token provides economic exposure to a portfolio rather than direct ownership of the underlying ETFs, and no collateral agreement for these portfolios has been identified.
Significant hurdles remain before tokenized fund shares can secure conventional trades. Banks and clearing organizations set their own eligibility standards, valuation methods and default-handling procedures, and must determine how legal ownership and settlement finality operate alongside fund documents. Tokenized money market funds also retain their redemption procedures, permitted-investor restrictions and portfolio risks. The October 19 report did not identify a completed agreement with a traditional clearinghouse or specify which BlackRock fund would be accepted next, and BlackRock did not disclose the amount of European fund tokens currently pledged against transactions.
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