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coinpedia 2024-12-18 19:46:21

BlackRock’s ETF Makes Historic Blockchain-Settled Municipal Bond Purchase

The post BlackRock’s ETF Makes Historic Blockchain-Settled Municipal Bond Purchase appeared first on Coinpedia Fintech News As per a latest Bloomberg report, BlackRock’s iShares Short Maturity Municipal Bond ETF, also known as MEAR, just made a historic purchase of municipal bonds issued and settled entirely on blockchain. The fund was founded in 2015 and has roughly $750 million in client assets. The securities were issued by the city of Quincy, Massachusetts, in April and underwriter JPMorgan Chase & Co. used an application on its private, permissioned blockchain-based platform to facilitate the sale. Notably, it was the first deal where muni debt was purchased, settled and held all in blockchain on the platform, completely bypassing traditional methods. A $6.5 Million Deal! BlackRock is the first investor to purchase a portion of the deal. The Quincy transaction involved $6.5 million in municipal debt purchased by BlackRock. Notably, the city of Quincy made waves earlier this year when it issued bonds using blockchain technology instead of the traditional system. JPMorgan’s blockchain platform, Digital Debt Service, was at the center of this innovation. “The use of blockchain throughout the lifecycle of bonds is just one example of the potential for this technology to transform capital markets,” said Pat Haskell, head of the municipal bond group at BlackRock. “This transaction marks a significant moment for the municipal bond market and is a testament to BlackRock’s dedication to innovation.” The prospectus for MEAR was updated to allow the fund to invest in muni bonds settled on JPMorgan’s application Digital Debt Service, according to a US SEC filing dated Dec. 17. The firm updated its ETF’s prospectus to allow blockchain-based bond investments. This required a filing with the U.S. Securities and Exchange Commission, which also outlined the risks, like limited liquidity and the possibility of bugs or errors in the blockchain application. Some issuers and underwriters have been exploring the use of blockchain technology in the muni market. For example, the Michigan State University board of trustees considered a deal to be registered on a digital platform provided by Goldman Sachs. IBIT Smashing Records Blackrock’s iShares Bitcoin Trust (IBIT), launched earlier this year, is smashing records. Over the past day, IBIT pulled in $740 million in inflows. It now manages over $51 billion in assets, making it one of the fastest-growing ETFs in history. Over the past 24 hours alone, IBIT pulled in $740 million. Combined with Ethereum ETF inflows, BlackRock’s crypto ETFs hit $860 million in just one day.

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