Today, Injective is introducing the tokenized index for BlackRock’s BUIDL Fund, allowing users, for the first time, to access the fund with innovative on-chain financial instruments.
This is the first perpetual index market of its kind that tracks the supply of the BUIDL fund itself. The BUIDL fund is BlackRock’s first tokenized fund, giving holders U.S. dollar yields. The BUIDL Index will be exclusively accessible via a range of different dApps only on Injective, such as Helix, offering a new gateway to the tokenized fund with the lowest fees and fastest speeds in the crypto space.
Background on BUIDL
BUIDL is BlackRock’s first tokenized fund issued on a public blockchain. Also known as the BlackRock USD Institutional Digital Liquidity Fund, BUIDL provides institutional investors access to yield on assets such as U.S. treasuries.
Specifically, the BUIDL token offers a stable value of $1 per token. In addition, token holders get a dividend that accrues daily and is then paid every month. The contents of the fund and source of the yield include cash, U.S. treasury bills, and repurchase agreements. According to recent data from real world asset analytics platform Rwa.xyz, the BUIDL fund has accrued over $500 Million in assets under management which makes BUIDL the largest tokenized fund to date.
A number of parties are involved in the creation of the BUIDL fund itself, for which BlackRock serves the primary role of investment manager. Blockchain firm Securitize helps to manage the tokenized shares and reports on fund subscriptions, redemptions, and distributions. Other initial participants in BUIDL include prominent firms in crypto, such as Coinbase, along with longstanding Injective institutional partners BitGo and Fireblocks.
Under the Hood: How the BUIDL Index Works
The BUIDL Index brings the world’s first perpetual market for BlackRock’s BUIDL Fund, allowing anyone to gain 24/7 exposure to tokenized assets such as U.S. treasuries with leverage.
This index was created in collaboration with Stork, a decentralized on- and off-chain price feed. Stork focuses on performance, utilizing ultra-fast WebSockets to ensure data availability at the millisecond level, comparable to the data used for trading in traditional finance (TradFi). With the help of Stork, Injective was able to launch a RWA-specific oracle during its broader Altaris Mainnet upgrade last month. This advanced oracle network expands Injective’s capacity to offer never-before-seen tokenized asset offerings, ensuring that data feeds for these assets are accurate and tamper-proof.
Instead of simply creating an asset that tracks the price of the underlying asset, this index perpetual market tracks the underlying supply of the BUIDL fund itself. This was done due to rising demand in the space for tracking inflows and outflows from the BUIDL Fund, which has, over the past few months, become a barometer for institutional interest in crypto as a whole.
“The launch of the BUIDL Index showcases the sheer potential of Injective’s infrastructure in being able to truly bring traditional finance onto fully decentralized rails. For the first time, institutions and retail users alike can gain direct access to a novel RWA offering that tracks the actual fund spearheaded by BlackRock,” said Eric Chen, co-founder and CEO of Injective Labs.
So how does the BUIDL Index work in practice? For example, today there are ~$500 million of BUIDL tokens minted. As the supply of BUIDL tokens rises, the price of the index perpetual also rises. As supply falls, the price of the index perpetual falls. Users are therefore able to take on long or short positions on the index depending on which way they think the market is going. Also, because of the nature of this index perpetual market on native Injective DEXs such as Helix, traders have the option to utilize leverage.
The market is based on the fund’s mark price, which fluctuates intraday based on the percentage increase or decrease of supply. Price changes are reflected in the market using a 1-hour TWAP to mitigate any short-term volatility resulting from significant mint or burn movements.
Expanding RWA Tokenization on Injective
The release of the BUIDL Index is a major milestone in Injective’s ever-growing presence in the asset tokenization space. Developers and community members alike are continuing to make strides in further converging the world of traditional and on-chain finance, making Injective the primary L1 for novel asset offerings that would not be possible on any other chain.
With technical breakthroughs such as the release of the first-ever RWA module, Injective allows developers to launch new tokenized offerings seamlessly. This, combined with the launch of the RWA oracle, has allowed for the creation of the BUIDL Index today.
The BUIDL fund was only open to institutions that could invest at least $5 million. Now, anyone around the world can trade the BUIDL index perpetual future market with as little as $1, meaning more users than ever can now gain exposure to an entirely new asset class that was previously gated to remain in the hands of the elite few.
As the first and only blockchain built for finance, Injective is continuing to pave the way towards a new capital-efficient world in which traditional and on-chain finance truly converge for the first time.
Disclaimer: Injective’s BUIDL Index and Blackrock’s BUIDL Fund are separate, unaffiliated products and their respective performance may differ substantially. Injective's BUIDL Index is designed to track the supply of BUIDL tokens issued by the BUIDL Fund, not the market price of the BUIDL Fund itself. As always, you should do your own research on how a particular product or application functions. This communication is intended for informational purposes only and is not, and should not be relied on, as financial or investment advice; an offer to buy or sell any product; or an endorsement of any product.
About Injective
Injective is a lightning fast interoperable layer one blockchain optimized for building the premier Web3 finance applications. Injective provides developers with powerful plug-and-play modules for creating unmatched dApps. INJ is the native asset that powers Injective and its rapidly growing ecosystem. Injective is incubated by Binance and is backed by prominent investors such as Jump Crypto, Pantera and Mark Cuban.
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About BUIDL
BUIDL is the BlackRock USD Institutional Digital Liquidity Fund, a tokenized fund developed by BlackRock that runs on the Ethereum blockchain, providing US dollar yields through tokenization. BUIDL enables investors to acquire tokens that represent shares in the fund, which invests in assets such as US Treasury bills. It provides instant settlement, improved liquidity, and seeks to maintain a stable token value while distributing dividends on a monthly basis. Read more about BUIDL in the launch press release.