BlackRock is developing tokenized ETFs and real-world asset funds on blockchain systems

BlackRock is building a path to throw ETFs and real-world assets onto the blockchain, according to Bloomberg.

The world’s largest asset manager is now exploring how to turn traditional investment funds into crypto-compatible tokens that could trade around the clock, way beyond the stock market’s regular hours.

The project is still in the works and depends heavily on regulators signing off, but the company is reportedly focusing on tokenizing funds tied to stocks and other tangible financial assets. This is BlackRock’s next phase in its larger blockchain experiment.

Back in 2024, BlackRock launched BUIDL, a tokenized money-market fund that now manages more than $2 billion and gets heavy use across crypto trading platforms.

That launch followed the rollout of iShares Bitcoin Trust (IBIT), BlackRock’s spot Bitcoin ETF, which quickly became the most successful ETF debut in U.S. history.

BlackRock uses JPMorgan’s Kinexys to test tokenized fund shares

The asset manager has already tested tokenized trades using JPMorgan’s Onyx, now known as Kinexys. Those trades were part of its larger trial of digital settlement infrastructure, a key piece of how tokenized assets would move in real-time.

Larry Fink, the company’s chief executive, wrote in his 2025 annual letter to investors that “every financial asset can be tokenized”, repeating a view he’s expressed for years. And now, the company is pushing that idea deeper into public equity territory.

Tokenizing ETFs would allow trading to continue outside the U.S. market’s daily window, and potentially make them usable as collateral in crypto platforms.

The industry sees tokenized share classes as a stepping-stone to something much bigger: a full blockchain-based market where fractional shares and instant settlement are the norm.

The ecosystem is starting to expand. Exchanges like Kraken and Robinhood already offer tokenized stocks in international markets. Meanwhile, startups are piloting similar models under tight supervision. But moving ETFs to blockchain isn’t just about flipping a switch.

The existing market structure isn’t built for that. ETFs today clear through centralized clearinghouses like DTCC. Blockchain trades, on the other hand, settle instantly and never shut down. Reconciling those two systems raises legal and custodial questions regulators haven’t fully answered.

Trump administration supports controlled blockchain testing

Despite those problems, the environment has become more open. Under President Donald Trump, policymakers began supporting programs that let firms test blockchain-based markets in controlled settings.

That gave companies room to play with new tools without blowing up legacy systems. Now, with Trump back in the White House in 2025, that window for crypto-focused experimentation remains wide open.

The tokenized asset market is still tiny, about $28 billion, according to rwa.xyz, but the U.S. ETF market is worth trillions.

Meanwhile, Nasdaq has already asked regulators to approve trading of tokenized stock versions on its exchange, which, if approved, would be the first time blockchain infrastructure gets embedded into core U.S. equity markets.

At the same time, McKinsey & Co. projects the market for tokenized real-world assets could hit $2 trillion by 2030. The biggest progress so far has come from tokenizing U.S. Treasuries, which are simpler to digitize.

Companies like Securitize and Ondo have already moved several billion dollars’ worth of Treasuries on-chain. Meanwhile, BlackRock and Citigroup are now digitizing entire funds to attract crypto-native capital and streamline operations.

But going after public equities is a bigger leap. Stocks come with real-time decisions like shareholder votes, dividends, splits, and mergers. That’s the real infrastructure of capitalism, and messing with it requires new tools, rules, and probably a lot of headaches.

BlackRock, though, is already trying to figure out how to plug it into blockchain. Let’s see how that works out in the long term.

KEY Difference Wire helps crypto brands break through and dominate headlines fast