We advised Circle on launching a smart contract enabling transfers of BlackRock’s tokenized fund over the Ethereum Network

Davis Polk advised Circle Internet Financial, LLC on the launch of its smart contract functionality that allows holders of the BlackRock USD Institutional Digital Liquidity Fund (BUIDL) to transfer their tokenized shares to Circle over the Ethereum Network for USDC, Circle’s regulated and fully reserved U.S. dollar stablecoin. BUIDL is an institutional investment fund sponsored by BlackRock, Inc. The project marks one of the highest-profile implementations of tokenized real-world assets.

BUIDL is BlackRock’s first tokenized fund issued on a public blockchain. BUIDL seeks to offer a stable value of $1 per token and pays daily accrued dividends directly to investors’ wallets as new tokens each month. The fund invests 100% of its total assets in cash, U.S. Treasury bills and repurchase agreements, allowing investors to earn yield while holding the token on the blockchain. Circle’s breakthrough smart contract functionality enables the frictionless transfer of BUIDL shares on the secondary market to Circle for USDC. USDC provides a trusted and transparent method for users looking to sell their BUIDL shares but remain holders of digital dollars.

Circle is a global financial technology firm that enables businesses of all sizes to harness the power of digital currencies and public blockchains for payments, commerce and financial applications worldwide. Circle is the issuer of the USDC and EURC fiat-backed stablecoins.

The joint Davis Polk capital markets and financial institutions team included partners Dan Gibbons, Gabe Rosenberg and Zachary J. Zweihorn and associates Justin Levine, David Li and Tyler X. Senackerib. Members of the Davis Polk team are based in the New York and Washington DC offices.

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