Frax Finance is set to launch its rebranded stablecoin, frxUSD, backed by BlackRock’s USD Institutional Digital Liquidity Fund (BUIDL). This innovative collaboration aims to strengthen the bridge between traditional and decentralized financial systems by combining blockchain’s transparency with BlackRock’s institutional-grade financial assets.
According to Frax Finance founder Sam Kazemian, “frxUSD combines the transparency and programmability of blockchain technology with the trust and stability of BlackRock’s prime treasury offerings.” This strategic move positions frxUSD as a stablecoin offering direct fiat redemption and enhanced regulatory compliance.
Key Features of frxUSD
- Primary Reserve Asset: BUIDL will back the minting and redemption of frxUSD with its portfolio, including cash holdings, U.S. Treasury bills, and repurchase agreements.
- On-Chain Transparency: All transactions are recorded on the blockchain, ensuring full visibility for users and regulators.
- Fiat On-and-Off Ramp: Seamless integration with traditional finance enables efficient conversion between fiat and crypto.
BUIDL Fund’s Expanding Horizons
BlackRock’s BUIDL fund, managing over $400 million, has solidified its role as a leader in tokenized real-world assets. Its portfolio extends beyond Ethereum to platforms like Polygon, Arbitrum, Avalanche, Optimism, and Aptos. BUIDL also supports other projects, such as Ethena’s USDtb stablecoin, and is increasingly used as collateral for derivatives trading on centralized exchanges.
This expansion reflects the broader adoption of tokenized assets, with over $3.5 billion in assets like U.S. Treasuries now tokenized across blockchain ecosystems such as Ethereum, Solana, and Polygon (source: Dune Analytics). BlackRock’s approach aligns with its vision of making institutional-grade investments accessible on decentralized platforms.
Carlos Domingo, CEO of Securitize, commented, “Tokenized real-world assets provide an excellent bridge between traditional finance and decentralized finance, bringing institutional-grade investments on-chain with unprecedented transparency and efficiency.”
Disclaimer
The content provided in this blog is for informational purposes only and does not constitute financial, investment, or trading advice. Cryptocurrency investments carry inherent risks due to market volatility. Readers are advised to conduct their own research or consult financial professionals before making any decisions. The author and publisher are not liable for any losses or damages resulting from the use of this content.
