BlackRock is in talks with some major crypto exchanges to promote its token BUIDL as collateral for crypto derivatives transactions

According to Bloomberg, insiders report that asset management firm BlackRock and its brokerage partner Securitize are in preliminary discussions with major cryptocurrency exchanges to use BlackRock's new BUIDL token as collateral for derivative trades. The BUIDL token has a minimum investment of $5 million and is designed for accredited institutional investors.

Brokerages FalconX and Hidden Road have already allowed their clients, including hedge funds, to use BUIDL as collateral. Custodian Komainu stated on Thursday that clients eligible to invest in BUIDL will be able to use the token as collateral to trade through Hidden Road.

Similar to other money market funds and most stablecoins, BUIDL is valued at one US dollar and its investments include US Treasury bills, cash, and repurchase agreements. However, unlike stablecoins such as Tether's USDT and Circle's USDC, BUIDL pays interest to its holders, which may enhance its appeal to derivative traders.