BlackRock has launched its first European UCITS tokenized money market funds (MMFs), after officially unveiling two new US-based tokenized money market products yesterday. The asset manager is issuing new digital share classes in six existing UCITS funds in its BlackRock Institutional Cash Series (ICS) in dollars, euros and sterling, and using Kinexys by JP Morgan for tokenization.
While BlackRock first partnered JP Morgan for tokenization years ago on the Kinexys permissioned DLT, these latest MMF tokens are being issued on the public Ethereum blockchain. The purpose of the digital share class includes enabling liquidity for corporate treasurers and collateral mobility. In a sign that demand is creeping beyond digital natives, in June Europe’s largest asset manager Amundi announced a deal with Ant International which is using Amundi’s tokenized MMF for corporate treasury purposes.
The BlackRock announcement highlighted that the fund’s transfer agent infrastructure is responsible for maintaining the official shareholder registry, and JP Morgan is the transfer agent. That is not unusual, but the critical question is when is it updated? Digital transfer agents support real time updates, but that is not always the case with tokenized funds. We received confirmation that Kinexys scans the blockchain for activity and updates the transfer agency records 24/7, so there is no need to wait for working hours. The minting of new tokens only happens during the fund operating hours.
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