Abu Dhabi company will initiate a tokenized US Treasuries fund

Realize will tokenize the units of the T-BILLS Fund, whereas Neovision will oversee its management.

Neovision Wealth Management, based in Abu Dhabi, in collaboration with Realize, has introduced an investment vehicle that would acquire units of exchange-traded funds (ETFs) centered on U.S. Treasury bills and convert these assets into digital tokens for holding, trading, and transferring on a blockchain.

The fund, named Realize T-BILLS Fund, will acquire BlackRock's iShares and State Street's SPDR, tokenize units from these ETFs, and integrate them into the fund, stated Dominik Schiener, co-founder of the technology firm Realize, in an interview with Reuters. It aims to expand to a $200 million fund.

Realize will tokenize the units of the T-BILLS Fund, whereas Neovision will oversee its management.

THE SIGNIFICANCE

Tokenized Treasuries are an expanding sector of the cryptocurrency market, boasting a market valuation of $2.4 billion on public blockchains, predominantly Ethereum, as reported by the data site rwa.xyz.

These are digital tokens generated on a blockchain, secured by U.S. government debt, and issued by both blockchain-native companies and conventional institutions, namely BlackRock and Franklin Templeton.

In March, BlackRock introduced its inaugural tokenized fund, BUIDL, on the Ethereum blockchain, allocating 100% of its assets to cash, U.S. Treasury bills, and repurchase agreements (repos). The BlackRock fund now possesses a market capitalization of $530 million.

FUND INFORMATION

The Realize fund will issue the $RBILL token, which will function as the digital equivalent of the fund's units. They will commence their launch on both the IOTA and Ethereum blockchain networks.

ESSENTIAL QUOTATIONS

The objective is to transfer fungible assets onto the blockchain. According to Schiener, T-Bills represent the most liquid asset currently available in the real world. "They represent the most effective form of collateral, yielding approximately 5%."

Dr. Ryan Lemand, co-founder and CEO of Neovision, stated that acquiring T-Bill ETFs and tokenizing them is more logical than directly purchasing Treasury bills on the market. He observed that purchasing cash Treasuries in the market entails ongoing transaction expenses due to the necessity of repeated acquisitions.