PANews reported on December 18 that a fund under BlackRock purchased municipal bonds issued earlier this year in a transaction that relied entirely on blockchain technology, according to Bloomberg. A spokesperson for the company stated that BlackRock acquired these bonds through its actively managed ETF - the iShares Short-Term Municipal Bond Active ETF (referred to as MEAR). The fund was established in 2015 and has approximately $750 million in client assets.
These securities were issued by the City of Quincy, Massachusetts, in April, with underwriter JPMorgan using an application on its private, permissioned blockchain platform to facilitate the sale. This marks the first municipal bond transaction fully purchased, settled, and held on the platform via blockchain. BlackRock stated that it was one of the first investors to purchase a portion of the bonds in this transaction.
Pat Haskell, head of BlackRock's municipal bond group, stated: "Using blockchain technology throughout the lifecycle of a bond is just one of many examples of how this technology has the potential to transform capital markets. This transaction is a significant moment for the municipal bond market and demonstrates BlackRock's commitment to innovation."