First tokenized Treasury Bill fund launches in Abu Dhabi, aiming for $100 million investment. It enhances liquidity and digital ownership via blockchain.
The first tokenized Treasury Bill fund has officially launched in the Abu Dhabi Global Market. This initiative aims to attract $100 million from investors within a year. The fund focuses on buying U.S. Treasury bonds, which are government bonds, according to Reuters. By creating blockchain-based tokens to represent these assets, the fund enables digital and fractional ownership. This model is designed to enhance liquidity and accessibility.
The investment vehicle is a product of Realize and Neovision Wealth Management, both based in Abu Dhabi. However, it still intends to acquire units of exchange-traded funds (ETFs) that track U.S. Treasury Bills. Once the fund owns these assets, it will tokenize them to be owned, bought, sold, or transferred on a blockchain.
Known as the Realize T-BILLS Fund, the fund plans to buy shares in BlackRock’s iShares and State Street’s SPDR. Consequently, these assets will be tokenized and part of the fund. The fund was founded by Realize’s Dominik Schiener, who said that the fund’s goal is to reach $200 million.
Neovision and Realize Partner for Tokenized Treasury Fund
In this partnership, Neovision will manage the tokenization process, while Realize will be responsible for the actual tokenization. Such centralized treasuries are becoming a large part of the cryptocurrency market as tokens. Today, $2.4 billion worth of capitalization is estimated to be invested in public blockchains, primarily in Ethereum.
Tokenized treasuries refer to tokens developed on a blockchain and associated with United States treasuries. They are issued by both blockchain-native firms and conventional institutions, with key market players like BlackRock and Franklin Templeton.
Earlier this year, BlackRock entered the world of tokenized funds and introduced its first tokenized fund, BUIDL, on the Ethereum blockchain. This fund buys only cash, U.S. Treasury bills, and repurchase agreements. Currently, BUIDL has a total market capitalization of $530 million.
Realize Fund is the first tokenized fund to be registered in ADGM, the financial centre in Abu Dhabi. It will release the US$RBILL token as the digital currency equivalent of the fund’s units. The tokens will be first on the IOTA and Ethereum platforms, so they can be distributed to interested investors with relative ease.
In addition, Schiener emphasized that the platform’s vision is to take fungible assets to the blockchain. He highlighted that T-bills are the most liquid asset in the real world. As a result, they serve as an excellent form of collateral, currently offering approximately 5%.
Meanwhile, Dr. Ryan Lemand, CEO of Neovision, discussed the advantages of tokenizing T-bill ETFs. He argued that this method helps avoid the continuous transaction costs linked to buying Treasury bills directly. Consequently, this approach not only enhances efficiency but also lowers overall expenses for investors.
