Coinspeaker BlackRock ETF Buys Municipal Debt Through JPMorgan Blockchain-Based Platform
The iShares Short Maturity Municipal Bond Active ETF (Cboe BZX: MEAR), a fund managed by BlackRock Inc. (NYSE: BLK), has invested in debt securities issued by the city of Quincy, Massachusetts. According to a Bloomberg report, BlackRock’s MEAR invested up to $6.5 million in the Quincy deal, which was facilitated by a blockchain-based platform backed by JPMorgan Chase & Co. (NYSE: JPM).
As a result, the MEAR now holds more than $746 million in net assets under management (AUM), as of December 17, 2024. The MEAR fund was founded in early 2015 and has since invested in several states, including Texas, and New York, among others.
“The use of blockchain throughout the lifecycle of bonds is just one example of the potential for this technology to transform capital markets. This transaction marks a significant moment for the municipal bond market and is a testament to BlackRock’s dedication to innovation,” Pat Haskell, head of the municipal bond group at BlackRock, noted.
BlackRock on Blockchain-Based Financial Solutions
According to documents filed to the United States Securities and Exchange Commission (SEC), the MEAR prospectus was updated to invest in municipal bonds settled on JPMorgan’s blockchain-based application on December 17. The investment firm, however, cautioned its clients that the blockchain-based application faces several risks including lack of liquidity, potential errors, and underlying computer codes, among others.
Nonetheless, more market makers have been working on blockchain-based applications to enhance the adoption of the municipal bonds markets. Furthermore, blockchain technology is widely accessible by more users around the world seamlessly with low friction, including minimal transaction fees.
The $11.5 trillion investment firm has focused significantly on disruptive technologies including blockchain to enhance its portfolio management in the recent past. Furthermore, the future of traditional financial services is expected to run on the internet with blockchain and AI at the forefront,
Earlier this year, BlackRock received a green light from the US SEC to issue and list shares of spot Bitcoin and Ethereum ETFs. According to the latest market data as of this report, BlackRock’s IBIT has registered a Cumulative net inflow of about $37 billion since inception and now has assets worth about $58.5 billion.
The company’s spot Ethereum ETF dubbed ETHA has registered a net cash inflow of over $3.3 billion since inception and now holds assets worth over $4 billion.
The investment firm has focused on blockchain tokenization of real-world assets as a major game changer in the coming years. As Coinspeaker previously explained, BlackRock is a major partner of the Securitize platform, a tokenization platform on the Ethereum (ETH) network.
The firm is expected to tokenize most of its funds on the blockchain to access more global markets seamlessly ahead.
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BlackRock ETF Buys Municipal Debt Through JPMorgan Blockchain-Based Platform
