TradFi firms now choose public blockchains: Ex-Grayscale exec

Tradfi Firms Now Choose Public Blockchains: Ex-Grayscale Exec

Traditional financial institutions are more interested than ever in promoting assets on public blockchains, says a former Grayscale executive.

Speaking to Cointelegraph, Selissa Morin, who served as the platform's vice president of distribution until mid-2023, said a new BlackRock-led narrative among TradFi institutions is that many companies want to demystify assets on public chains from private individuals.

“I think we'll see a preference for private chains with JPMorgan Onyx. But I think this narrative was a few years ago. Now, I think this is a very public blockchain.

Morin is now head of the crypto department at international law firm Reed Smith, and has said it makes sense for large traditional financial institutions to follow BlackRock, which launched a $100 million token fund ‘BUIDL' on the Ethereum network on March 18.

The BUIDL fund now holds $288 million in assets, according to Dunn Analytics data.

Senior Guaranteed Government Securities Funds. Source: Dune Analytics

BlackRock's move to launch a fund on Ethereum was not without controversy, with the asset manager's on-chain wallet quickly becoming the target of various spiel from crypto enthusiasts.

BlackRock's public wallet depository includes legitimate dubious transactions from the current OFAC-approved hybrid Tornado Cash, as well as a list of cryptocurrencies from Real World Asset (RWA) token projects and memecoins.

Despite the legal issues that may come with choosing to tokenize assets on public blockchains — rather than using a private network that's more KYC and AML-friendly — Morin said more companies could take BlackRock's lead.

If Blackrock made these choices, I don't know why the rest of the crew would be banned.

Morin also stated that Franklin Templeton moved “forward thinking” to launch a token money market fund on the Ethereum layer-2 network Polygon in October of last year.

Related: Over $1B in US Treasuries Now Off Chain

Franklin Templeton's 11-month-old Franklin OnChain U.S. Treasury Fund ( FOBXX ) currently holds a total of $360.2 million in U.S. Treasuries. A total of $1.08 billion of US Treasuries are now marked on 17 products.

The Ethereum ETF is unlikely in May.

Morin was less enthusiastic about Spot Ether (ETH) exchange-traded funds (ETFs), which are not expected to be approved in May.

Having previously worked with a legal team to launch a grayscale Bitcoin ETF, Morin recently agreed that the lack of communication between funders and the US Securities and Exchange Commission is a bad sign.

Echoing the sentiment of senior Bloomberg ETF analyst Eric Balchunas — Morin's odds of approving VanEck by the May 23 deadline decrease with each day the SEC refrains from engaging in public opinion.

Magazine: Bitcoin ETFs Make Coinbase a ‘Honeypot' for Hackers and Governments – Treasure CEO

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