BlackRock is set to broaden its reach in the stablecoin market by launching a restructured money market fund that adheres to the new regulations under the GENIUS Act, aimed at providing a secure reserve option for stablecoin issuers.

The asset management firm, with $13.5 trillion in assets, announced that its newly named fund, the BlackRock Select Treasury Based Liquidity Fund (BSTBL), will serve companies tied to US dollar-pegged stablecoins, offering a reliable avenue for managing customer deposits, as reported by CNBC.

“We want to be — and we believe we are — a preeminent reserve manager for stablecoin issuers,” remarked Jon Steel, the global head of product and platform for BlackRock’s cash management division.
Translation: We want to be, and we believe we are, a leading reserve manager for stablecoin issuers.

This move aligns with the recently enacted GENIUS Act, which established the United States’ first regulatory framework for stablecoins, focusing on how issuers should handle and invest their reserves. BlackRock’s fund is designed to comply with these new regulations.

BlackRock Restructures Fund for Stablecoin Reserves

In a filing with the Securities and Exchange Commission in August, BlackRock detailed the renaming and restructuring of its previous BlackRock Liquid Federal Trust Fund, which invested solely in cash, U.S. Treasury bills, and notes.

The board has approved adjustments that took effect recently, with the fund now focusing exclusively on short-term U.S. Treasury securities and overnight repurchase agreements, catering to institutional investors, including stablecoin issuers.

BlackRock’s website displays the new fund. Source: BlackRock

This fund modification also expands its trading hours and alters its valuation schedule to enhance operational efficiency.

In its summary prospectus, BlackRock outlined a breakdown of the fund’s fees, which include a 0.21% management fee, a 0.10% shareholder servicing fee, and a total expense ratio of 0.27% post-waivers, with a fee waiver agreement in place until June 30, 2026.

The new fund’s Summary Prospectus. Source: BlackRock

This fund marks a significant step for BlackRock into the stablecoin sphere, potentially positioning the company as a major player in managing reserves for US dollar-pegged assets.

This strategic move aligns with BlackRock’s overarching digital asset approach, which already encompasses a Bitcoin ETF, an Ether product, and the recently launched BUIDL tokenized liquidity fund earlier this year.

BlackRock Targets More Stablecoin Issuers

Additionally, BlackRock manages reserves for Circle, the company behind the USDC stablecoin, through an established partnership that has blossomed alongside the rising adoption of stablecoins. The BSTBL fund aims to extend similar services to a broader range of issuers amidst increasing demand for regulated, yield-bearing reserve alternatives.

Analysts at Citi have projected that stablecoin issuance could grow from $280 billion today to $4 trillion by 2030, showcasing the immense potential of this market.