BlackRock executives claim that blockchain tokenization will drive transformation in financial infrastructure, with BUIDL reaching $2.3 billion.

BlackRock executives have stated that the financial system is undergoing the largest infrastructure transformation since the emergence of electronic information technology in the 1970s, driven by blockchain-based tokenization technology. CEO Larry Fink and COO Rob Goldstein pointed out in a column for The Economist that the financial industry is “entering the next major phase of transformation in market infrastructure,” with tokenization expected to transfer assets more quickly and securely.

Tokenization records asset ownership on a digital ledger, enabling the trading and settlement of assets such as stocks, bonds, and real estate without the need for traditional intermediaries. BlackRock believes that this technology can expand the range of investable assets, achieve instant settlement, and replace manual processes and customized settlement methods. Executives emphasize that tokenization will not immediately replace existing systems, but will serve as a “bridge” connecting traditional institutions with digital innovators.

Zhu Yaohua, co-chairman of the Hong Kong Web3 Association, stated that BlackRock is heading in the right direction, but tokenization is a multi-cycle transformation process that cannot be achieved overnight. Tokenization can only truly play a role in finance when it addresses issues that traditional systems cannot resolve, such as reducing settlement risks, increasing collateral liquidity, or opening channels to inaccessible assets.

Currently, tokenized financial assets still have a small share in the global stock and bond markets, but they are growing rapidly, with an increase of about 300% over the past 20 months. BlackRock's dollar institutional digital liquidity fund (BUIDL) has reached 2.3 billion USD, becoming one of the largest tokenized assets globally. Fink pointed out that assets involving multiple layers of intermediaries, such as real estate, can reduce costs and enhance affordability through tokenization.

Overall, BlackRock is actively positioning itself in tokenization assets, promoting the integration of traditional finance and blockchain technology, laying the foundation for the “next generation market”. (Decrypt)