BlackRock Makes Moves to Expand the Use of Its Digital Money-Market Coin, BUIDL, as Collateral for Cryptocurrency Derivatives Trades

These talks are a part of making BUIDL accepted as collateral on platforms such as Binance, OKX, and Deribit.

BlackRock is reportedly in talks with several cryptocurrency derivatives exchanges to have its digital money-market coin, BUIDL, accepted as collateral for trades on their platforms.

Binance, OKX, and Deribit are among the exchanges that BlackRock is discussing the matter with, according to a report by Bloomberg on Monday. The talks are said to be in early stages and could still fall through.

The BUIDL token is designed for qualified institutional investors with a minimum investment of $5 million. It was launched in March by BlackRock as part of its BlackRock USD Institutional Digital Liquidity Fund. The token is intended to track the net asset value of the fund, which invests in instruments such as US Treasury bills, cash, and repurchase agreements.

Like most stablecoins, BUIDL aims to maintain a value of $1. However, a key differentiator is that BUIDL pays interest to holders, which could potentially enhance its appeal to derivatives traders.

If successful, the integration of BUIDL into major cryptocurrency derivatives exchanges would mark a significant expansion in the use case of the token. It could also pose a challenge to established players in the derivatives market such as Tether and Circle.

The cryptocurrency derivatives market is a massive and rapidly growing opportunity. In September alone, derivatives accounted for over 70% of total crypto trading volume. An estimated $3 trillion worth of contracts were traded on centralized exchanges, according to researcher CCData.

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