Fidelity vs. BlackRock: A Blockchain Battle for Tokenized Treasury Domination
Financial institution Fidelity pursues a fund based on tokenized U.S. Treasuries, aiming to stay ahead in the BUIDL race.
Competition in the burgeoning tokenized finance market intensifies as Fidelity is reportedly launching an Ethereum-powered Treasury bond fund, squaring off against BlackRock's BUIDL which recently amassed over $1 billion in management scale. Here, we dive into the implications for market growth, strategic differentiation, and the race to capture institutional liquidity.
Institutional Growth and Adoption:
- BlackRock's BUIDL fund saw unprecedented growth, adding a staggering $1.283 billion in assets in just March 2025 [Referenced Source 3], and overall tokenized Treasury issuance surpassing $5.75 billion by April [Referenced Source 1].
- Fidelity's SEC-filed Ethereum-based fund (set to launch May 30 [Referenced Source 3]) offers a direct challenge to BlackRock's dominance in Real-World Asset (RWA) tokenization by leveraging Ethereum's blockchain for seamless 24/7 settlement and transparency [Referenced Sources 2, 3].
Strategic Distinction:
- BlackRock emphasizes scalable, low-risk exposure to short-term Treasuries, appealing to institutions already utilizing its traditional funds [Referenced Sources 1, 3].
- Fidelity concentrates on interoperability across on-chain DeFi protocols and cross-chain applications [Referenced Sources 2, 3], positioning its tokens as adaptable assets in the ever-evolving digital financial landscape.
Regulatory and Technological Edge:
- Both funds operate under SEC-compliant frameworks, but Fidelity's decision to adopt a public blockchain (in contrast to BlackRock's private DLT approach) indicates a bet on open infrastructure for wider institutional adoption [Referenced Sources 1, 3].
- With players like Spark ($3.5B+ in tokenized Treasuries [Referenced Source 4]) and Arca-led Lynq (real-time yield distribution [Referenced Source 5]) adding to market pressure, Fidelity and BlackRock's established brand recognition solidifies them as prime contenders for institutional liquidity [Referenced Sources 1, 3, 5].
The heightened competition fuels innovation, particularly in matters of yield optimization (daily payouts vs. traditional monthly [Referenced Source 5]) and settlement efficiency, making tokenized Treasuries a stepping stone for more substantial institutional crypto adoption [Referenced Sources 1, 3]. This fiery contest between Fidelity and BlackRock is set to reshape the tokenized finance landscape.
Sources:[1] "Fidelity to Launch Tokenized U.S. Treasury Fund," CoinDesk, May 12, 2025, https://www.coindesk.com/business/2025/05/12/fidelity-to-launch-tokenized-us-treasury-fund/[2] "Interview: Fidelity's John D'Agostino on Tokenizing Real Assets," Cointelegraph, May 18, 2025, https://cointelegraph.com/news/interview-fidelity-s-john-d-agostino-on-tokenizing-real- assets[3] "Fidelity Getting ready to Debut ETF Tracking Ethereum-based Tokenized Treasuries," The Block, May 13, 2025, https://www.theblockcrypto.com/linked/103534/fidelity-getting-ready-to-debut-etf- tracking-ethereum-based-tokenized-treasuries[4] "Spark Network Token Secures over $3.5 Billion in Tokenized Repurchase Agreements," CoinDesk, March 31, 2025, https://www.coindesk.com/business/2025/03/31/spark-network-token-secures-over-3-5-billion-in-tokenized-repushase-agreements/[5] "Arca's Lynq Distributes Yields in Real Time on Solana, Attracting Institutional Interest," CoinDesk, March 26, 2025, https://www.coindesk.com/business/2025/03/26/arcas-lynq-distributes-yields-in-real-time-on-solana- attracting-institutional-interest/
- Fidelity's SEC-filed Ethereum-based fund, scheduled for launch on May 30, will face off against BlackRock's scalable Real-World Asset tokenization through its BUIDL fund, showcasing a battle for dominance in tokenized finance.
- As Fidelity focuses on interoperability across decentralized finance (DeFi) protocols and cross-chain applications, untokenized Treasuries can become adaptable assets in the digital financial landscape, distinguishing its approach from BlackRock's.
- The use of Ethereum's blockchain for a seamless 24/7 settlement and transparency sets Fidelity's fund apart from BlackRock's private DLT approach, revealing a bet on open infrastructure for faster institutional adoption.
- The race to capture institutional liquidity intensifies as emerging players like Spark and Arca-led Lynq add pressure, with Fidelity and BlackRock's established brand recognition solidifying them as prime contenders.
- This fierce competition is expected to spur innovation in areas such as yield optimization, settlement efficiency, and daily payouts, hence making tokenized Treasuries a stepping stone for substantial institutional crypto investment and reshaping the tokenized finance landscape.
