BlackRock is entering DeFi. Its tokenized U.S. Treasury fund, BUIDL, can now be used as collateral on Euler Finance, a decentralized lending protocol running on Avalanche.
BlackRock Goes Live on Avalanche via Euler
BlackRock has taken its first step into DeFi by allowing its tokenized Treasury fund, BUIDL, to be used as collateral on the Euler lending platform, built on the Avalanche blockchain.
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The move enables users to lock up sBUIDL, a digital, fully redeemable version of the BUIDL fund backed by short-term U.S. Treasuries, as collateral to borrow stablecoins like USDC and AUSD. Borrowers will continue to earn yield from the underlying Treasuries while also receiving bonus AVAX rewards, Avalanche’s native token.
sBUIDL, a tokenized version of BlackRock’s BUIDL fund, is fully backed by U.S. Treasuries and can be redeemed at any time, giving it real utility in DeFi without sacrificing liquidity or risk standards.
The system uses Chainlink’s decentralized data feeds to ensure accurate pricing and enhance security.
This initiative is part of BlackRock’s broader strategy to bring BUIDL to multiple blockchain networks—including Aptos, Arbitrum , Optimism, and Polygon—to expand the fund’s utility and reach in the DeFi space.
Until now, BlackRock’s tokenization efforts, mainly through partnerships with firms like Securitize, were focused on issuing digital versions of traditional financial products.
Euler Relaunches After Major Exploit
The integration also highlights Euler’s comeback story. Once the target of a major exploit, the protocol has rebuilt its infrastructure and reputation, now partnering with the biggest name in asset management.
Euler, a decentralized finance (DeFi) lending platform, suffered a major setback in 2023 when a smart contract vulnerability was exploited, resulting in a $197 million loss. The attack impacted multiple assets and thousands of users, dealing a heavy blow to confidence in the protocol.
Following months of redevelopment and security upgrades, Euler relaunched in 2024 with a more modular and developer-friendly design. By spring 2025, it had regained momentum, attracting over $387 million in user deposits.
Wall Street Giants Embrace Blockchain
BlackRock isn’t the only major traditional finance (TradFi) player stepping into decentralized finance (DeFi) and blockchain technology.
Franklin Templeton has been a trailblazer in this space. Back in 2021, it became the first asset manager to launch an on-chain money market fund, signaling an early move toward blockchain adoption. As of early 2025, the firm manages around $689 million in tokenized assets.
Fidelity International is also moving fast. In June 2024, it tokenized shares of its money market fund using JPMorgan’s Onyx Digital Assets blockchain. Fidelity’s digital asset unit is actively exploring stablecoins, tokenized Treasuries, and on-chain credit opportunities.
JPMorgan, meanwhile, is playing a central role in the ecosystem. Its Onyx platform supports the tokenization of traditional financial instruments like money market funds and is being used by institutions like Fidelity to modernize asset infrastructure.
Why This Matters
The move reflects growing institutional interest in bringing traditional financial products into blockchain-native environments, where assets can be used programmatically across multiple protocols, offering new liquidity, transparency, and capital efficiency.
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