emre yumlu 
Frax Finance community has started voting to adopt BlackRock’s BUIDL as a reserve asset for Frax USD (frxUSD).
The vote, which opened on December 26, has seen all votes cast by decentralized finance (DeFi) lending protocol tokenholders in favor of the proposal so far. All comments in the discussion are also supportive. The vote will remain open until January 1, 2025.
According to the vote summary, the benefits of passing the proposal for Frax USD may include creating income opportunities, deeper liquidity, transfer options, and reduced counterparty risk due to the backing of BlackRock.
In the December 22 discussion about the proposal, initiated by real-world asset tokenization platform Securitize, the broker-dealer for BlackRock’s BUIDL, a user named Achaffee said the move would help bridge traditional finance and DeFi.
According to Achaffee, tokenized real-world assets (RWAs) provide an excellent bridge between traditional finance and DeFi by bringing institutional-grade investments onchain.
Achaffee: “In the last 9 months alone, we’ve seen major players, including DAOs and decentralized protocols, put out large public RFPs to explore how they can most effectively strengthen their treasuries or back their stablecoins with RWAs.”
“These early explorations mark a significant evolution in how decentralized players manage their financial resources and consider cross-industry asset strategies,” added.
BUIDL, launched on March 15, surpassed half a billion dollars in assets under management (AUM) in less than four months.
BUIDL is pegged 1:1 with the US dollar and pays daily accrued dividends directly to investors each month through a partnership with Securitize. The fund invests in US government securities.
According to Dune Analytics data, $3.4 billion worth of tokenized treasury funds are now onchain.
Frax is not the first platform to consider a BUIDL-backed stablecoin. Ethena Labs, which is behind the USDe synthetic dollar, announced on September 26 that it was working on a BUIDL-backed stablecoin. This stablecoin, named USDtb, is a separate product offering from Ethena’s USDe. USDtb went live on December 16 and has accrued $89 million in total value locked (TVL), according to data from DefiLlama.
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