BlackRock’s Fink: Tokenization to Bridge Crypto and Finance
BlackRock CEO Larry Fink and chief operating officer Rob Goldstein said tokenization can serve as a connector between the crypto sector and traditional finance, reiterating their backing for the technology. In a Monday opinion piece in The Economist, the executives wrote that tokenization is unlikely to supplant the current financial system in the near term but could help integrate the two markets. BlackRock is the world’s largest asset manager, overseeing more than $13.4 trillion in assets, and operates the largest tokenized cash market fund at $2.8 billion.
The executives compared the evolution to a bridge being built from both sides, with established institutions on one end and digital-native players such as stablecoin issuers, fintech firms and public blockchains on the other. They said the two sides are learning to interoperate, adding that in time investors may be able to buy, sell and hold a broad range of assets through a single digital wallet. Fink, a co-founder of BlackRock, had previously expressed skepticism toward crypto before revising his position.
Traditional finance increasingly recognizes tokenization’s advantages
Fink and Goldstein said the core value of tokenization was initially obscured by the crypto boom, which often appeared speculative. In recent years, however, they wrote that mainstream finance has identified the underlying potential: tokenization can extend the universe of investable assets beyond the publicly listed stocks and bonds that dominate today’s markets.
BlackRock’s BlackRock USD Institutional Digital Liquidity Fund (BUIDL), launched in March 2024, has grown into the largest tokenized cash market fund at $2.8 billion, according to the firm.
Regulatory alignment needed for traditional and tokenized markets
The executives said tokenization should advance with appropriate safeguards, calling on policymakers and regulators to update rules so that conventional and tokenized markets can operate together.
They drew parallels with the development of bond exchange-traded funds, which linked dealer markets with public exchanges and improved trading efficiency, and noted that spot Bitcoin ETFs have brought digital assets onto traditional venues. Each step, they said, has built connective infrastructure. Regulators, they added, should aim for consistency by evaluating risk based on its substance rather than its packaging, noting that a bond remains a bond even if recorded on a blockchain.
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