The era of round-the-clock trading is coming? BlackRock explores "tokenization" of ETFs.
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BlackRock, the world’s largest asset management company, is exploring the possibility of converting exchange-traded funds (ETFs) into blockchain tokens—a move that could fundamentally change the way one of Wall Street’s most important investment products operates.
On September 12, according to Bloomberg, people familiar with the matter revealed that the company is studying how to tokenize funds linked to real-world assets such as stocks. BlackRock already has successful precedents in the digital asset space.
The company's tokenized money market fund BUIDL, launched in 2024, has grown to over $2 billion and is very popular on cryptocurrency platforms. In addition, its spot Bitcoin ETF has also achieved great success, quickly becoming one of the most popular funds of this type in history.
According to reports, tokenizing ETFs could bring about transformative changes such as extending trading hours beyond Wall Street’s conventional timetable, making U.S. products more accessible to overseas investors, and enabling new uses as collateral within crypto networks.
Analysis points out that this innovation is attracting attention across the industry and is seen as an important step for the market’s migration to blockchain. BlackRock’s exploration highlights the trend of mainstream financial institutions beginning to test blockchain technology to transform market infrastructure.
Core Advantages of Tokenization Technology
Tokenization involves creating digital versions of traditional assets, allowing them to circulate on blockchain systems. For ETFs, this technology could enable 24-hour trading, breaking free from Wall Street’s fixed trading hours.
In addition, tokenization can make U.S. financial products easier for overseas investors to access and create potential new uses as collateral on crypto networks.
Proponents believe that migrating to blockchain can enable real-time settlement, share splitting, and other features. Money market funds have already paved the way for this transition, and flexibly designed ETFs may become experimental grounds for this shift.
BlackRock has long been an active advocate for digital assets. Besides the BUIDL fund, the company has tested trading tokenized fund shares on JPMorgan’s Onyx infrastructure (now called Kinexys) and has positioned itself as an early adopter of digital settlement models.
BlackRock CEO Larry Fink has emphasized the company’s optimistic stance, stating that every financial asset can be tokenized, reiterating this view in his 2025 annual letter to investors. This statement further highlights BlackRock’s confidence in blockchain technology’s ability to transform financial markets.
Interest in tokenization within the industry is heating up. Money market funds from firms like Franklin Templeton and BlackRock are paving the way, and ETFs—which are already relatively flexible investment vehicles—may become the proving ground for this transformation.
Exchanges such as Kraken and Robinhood have already offered tokenized stocks overseas, and start-ups are piloting similar services in controlled environments.
Facing Settlement System and Regulatory Challenges
According to reports, this transition faces major obstacles. Currently, ETFs are settled through Wall Street clearinghouses, while tokens on the blockchain are instantly and continuously movable. Coordinating these systems presents problems for regulators and custodians.
However, the regulatory environment is becoming more relaxed. During the Trump era, policymakers were open to allowing companies to test blockchain-based markets in controlled settings.
Meanwhile, Nasdaq has requested regulators to allow investors to trade tokenized versions of stocks on its exchange, which could mark the first major test of blockchain technology at the core of the U.S. stock market.
According to a previous article, Nasdaq’s CEO recently stated publicly that Nasdaq will move towards stock tokenization and embed blockchain technology directly into the core securities trading system, rather than confining it to over-the-counter or adjunct markets. Trading hours will gradually move toward 24/5 and even 24/7 in the future.
Analysts point out that although the market size for tokenized assets is still relatively small, BlackRock’s exploration shows that mainstream finance is beginning to test whether blockchain can reconstruct market infrastructure, potentially fundamentally changing everything from collateral mobility to settlement speed.
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