CoinDesk
BlackRock has developed three investment portfolios for Ondo Finance that package professionally constructed strategies into individual blockchain tokens. The portfolios target high income, diversified growth and high growth. Rather than buying and rebalancing each underlying investment separately, an investor can hold one token representing a portfolio strategy.
Why it matters
Funds and ETFs have long bundled investments, but a tokenized portfolio can move between wallets and platforms and be visible onchain. It could eventually serve as collateral or connect to other financial products. The shift is from putting individual assets onchain to putting asset-management strategies there too.
The established market is substantial: model portfolios held about $9.8 trillion in assets in June, according to Broadridge. That figure describes the broader model-portfolio business, not assets committed to tokenized products. Bitwise is testing a different structure with Glider: eligible non-U.S. investors retain individual tokenized stocks in their wallets while software adjusts holdings to target weights. Ondo instead packages portfolio exposure in one transferable token.
Market impact
For asset managers, tokenization offers another way to distribute strategies. For investors, it could reduce the number of positions and rebalancing decisions they manage themselves. Neither the Broadridge figure nor the launch of these portfolios establishes demand for the new tokens.
The longer-term ambition is more automated, personalized management across a wider range of onchain assets. Ondo's John Hoffman said that would require a broader asset universe, prime-brokerage infrastructure and strategies that can be executed natively on blockchain networks. Those requirements separate today's tokenized portfolios from continuously adjusting, real-time investment management.
Frequently asked questions
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What do BlackRock's three portfolios for Ondo focus on?
The strategies focus on high income, diversified growth and high growth. Each is packaged as an individual blockchain token representing portfolio exposure.
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How does an Ondo portfolio token differ from holding its underlying investments?
An investor can hold one token representing the portfolio rather than buying and rebalancing each underlying investment separately. The token can also move between wallets and platforms.
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Does the $9.8 trillion model-portfolio figure represent money in tokenized portfolios?
No. Broadridge's figure refers to assets held in the broader model-portfolio business in June, not assets committed to the BlackRock-Ondo products.
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How does Bitwise's approach differ from Ondo's?
Ondo packages portfolio exposure in a single transferable token. Bitwise's arrangement with Glider leaves individual tokenized stocks in eligible investors' wallets while software adjusts their allocations.
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What is needed before onchain portfolios can adjust in real time?
Ondo's John Hoffman identified a broader range of onchain assets, prime-brokerage infrastructure and investment strategies that can be executed natively on blockchain networks.
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