Brokerage firm Securitize has submitted a proposal to add the tokenized BlackRock BUIDL fund as collateral for the Frax USD stablecoin.
Securitize's Proposal
Securitize has proposed using the tokenized BlackRock US dollar Institutional Digital Liquidity Fund (BUIDL) as collateral for the Frax USD stablecoin. This proposal aims to enhance liquidity, reduce counterparty risks, and offer new yield opportunities due to the backing of the world's largest asset manager, BlackRock.
BUIDL Stablecoin Market
In September 2024, Ethena Labs announced the development of a BUIDL-backed stablecoin. This new product, called USDtb, went live on December 16, quickly accruing $65 million in total value locked (TVL).
New Partnerships and Outlook
In October 2024, BlackRock began conversations with exchanges like Binance, OKX, and Deribit to use BUIDL as collateral on their platforms. This raises questions about the dominance of current stablecoin issuers like Tether and Circle in providing reserves for crypto derivatives trading.
BUIDL continues to gain popularity as a collateral asset for stablecoins, opening new opportunities for exchanges and investors in the crypto industry.
