BlackRock Launches GENIUS Act-Compliant Stablecoin Reserve Fund

In a bold move signaling the deepening integration of traditional finance and cryptocurrency, BlackRock has unveiled a new money market fund tailored as a reserve vehicle for stablecoin issuers.

As the world's largest asset manager overseeing more than $13.5 trillion in assets, BlackRock's BlackRock Select Treasury Based Liquidity Fund (BSTBL) arrives at a pivotal moment for the $313 billion stablecoin market.

This fund offers a regulatory-compliant solution for parking reserves in high-quality U.S. Treasuries, directly addressing the requirements of the recently enacted GENIUS Act.

With stablecoin issuers already holding over $120 billion in U.S. Treasuries, BSTBL positions BlackRock to enhance liquidity, transparency, and efficiency in the crypto ecosystem.

Key Takeaways

• BlackRock's BSTBL fund is a retooled 2a-7 money market fund focused on short-term U.S. Treasuries and repos for stablecoin reserves.
• Aligned with the GENIUS Act's requirements for 1:1 backing and monthly audits, effective October 15, 2025.
• Offers tokenized features for 24/7 settlements, targeting issuers like Circle (USDC) and potentially Tether (USDT).
• Positions BlackRock to capture growth in the stablecoin sector, projected to reach $4 trillion by 2030.
• Enhances crypto market credibility, liquidity, and institutional adoption.

Background on BlackRock's Crypto Involvement

BlackRock has been steadily expanding its footprint in the digital asset space, recognizing the transformative potential of blockchain and cryptocurrencies. The firm already manages reserves for Circle's USDC stablecoin, one of the leading dollar-pegged tokens.

Earlier initiatives include the launch of the iShares Bitcoin Trust (IBIT) and an Ethereum ETF, which have attracted billions in inflows. BlackRock has also pioneered tokenized funds on the Ethereum blockchain, allowing for real-time asset representation and trading.

The BSTBL fund builds on this foundation, evolving from the existing BlackRock Liquid Federal Trust Fund to specifically cater to stablecoin needs, underscoring BlackRock's ambition to become a dominant player in bridging traditional finance (TradFi) with decentralized finance (DeFi).

Details of the BSTBL Fund

The BlackRock Select Treasury Based Liquidity Fund (BSTBL) is structured as a 2a-7 money market fund under the Investment Company Act of 1940, ensuring stability and liquidity.

Its portfolio is 100% allocated to short-term U.S. Treasury securities, such as bills and notes, alongside overnight repurchase agreements (repos) backed by Treasuries.

To optimize for stablecoin issuers, BlackRock has shortened asset maturities, extended trading hours to 5:00 PM Eastern Time, and incorporated later valuation times for global accessibility.

As of October 10, 2025, the fund maintains a net asset value (NAV) of $1.00, with a 7-day SEC yield of 4.06%. Fees include a 0.21% management fee, a 0.10% shareholder servicing fee, and total annual expenses of 0.27% after waivers through June 30, 2026.

A standout feature is its support for tokenization, enabling on-chain representations that facilitate 24/7 real-time settlements. This makes BSTBL particularly attractive for institutional users, including stablecoin giants like Circle and potentially Tether, who require compliant, low-risk reserve management.

The GENIUS Act: Regulatory Framework Driving the Change

The GENIUS Act, signed into law by President Donald Trump in July 2025, marks the first comprehensive U.S. federal framework for stablecoins. It mandates 1:1 backing with cash or short-term U.S. Treasuries, requires monthly third-party audits for reserve verification, and enforces enhanced transparency standards.

Designed to mitigate risks like those seen in past stablecoin depegging events, the Act aims to foster trust and stability in the digital asset market.

BlackRock's BSTBL fund is explicitly crafted to comply with these rules, serving as an approved reserve asset. This regulatory clarity has created a surge in demand for institutional-grade solutions, reducing dependence on unregulated custodians and paving the way for broader adoption by traditional financial players.

Market Implications and Expert Reactions

BlackRock's entry into stablecoin reserves could catalyze significant growth in the sector, with Citi analysts forecasting stablecoin issuance to balloon from $280 billion to $4 trillion by 2030.

The fund enhances credibility by offering a "safe, liquid, and compliant" option, potentially drawing more institutional capital into crypto. It also boosts liquidity through tokenized settlements, reducing friction in cross-border payments, remittances, and DeFi applications.

However, challenges include adapting to ongoing regulatory shifts and securing widespread adoption beyond partners like Circle.

On X, reactions have been enthusiastic:
- @WhaleInsider highlighted the fund's Genius Act compliance for simplifying custody.
- @StablesLabsHelp praised its role in validating synthetic stablecoins.
- @ThuanGlobal noted BlackRock's focus on proper reserve management.
- Other voices like @Crypto_Potato and @MetaEraHK emphasized the bridge between TradFi and crypto.

Broader Impact on Crypto and Traditional Finance

This fund exemplifies the convergence of crypto and TradFi, enabling faster innovation in areas like synthetic stablecoins and hybrid models. For investors, it signals maturing infrastructure that could attract trillions in capital, while mitigating risks through regulation.

Opportunities abound in payments and DeFi, but stakeholders must navigate potential hurdles like market volatility and evolving compliance. Overall, BSTBL could accelerate mainstream crypto adoption, fostering a more interconnected financial landscape.

Conclusion

BlackRock's launch of the BSTBL fund under the GENIUS Act framework solidifies its leadership in regulated digital assets, offering stablecoin issuers a robust tool for reserve management.

As the sector eyes explosive growth, this initiative not only enhances stability and liquidity but also invites greater institutional participation.

Looking ahead, widespread adoption could transform stablecoins into a cornerstone of global finance, driving efficiency and innovation across borders.

Read Next:

• OwlTing Makes History: Taiwan’s Stablecoin Leader Secures Nasdaq Listing as OWLS
• Alchemy Pay (ACH) Complete Breakdown: Crypto and Fiat Transactions
• French Banking Giant ODDO BHF Launches EUROD

FAQs:

1. What is BlackRock's new stablecoin reserve fund?

BlackRock's BSTBL fund is a compliant money market vehicle for stablecoin issuers to hold reserves in U.S. Treasuries, launched October 15, 2025.

2. How does the GENIUS Act affect stablecoins?

The GENIUS Act requires 1:1 backing with cash or Treasuries, monthly audits, and transparency, making funds like BSTBL essential for compliance.

3. Why is BlackRock entering the stablecoin market?

To deepen its crypto bet, manage reserves for issuers like USDC, and capitalize on the sector's growth from $313 billion to potentially $4 trillion by 2030.

4. What are the benefits of tokenized reserves in BSTBL?

They enable 24/7 real-time settlements, enhanced liquidity, and transparency, bridging traditional finance and decentralized crypto ecosystems.

5. How does this impact USDC and USDT issuers?

It provides a safe, liquid option for reserve management, potentially increasing credibility and attracting more institutional users.

6. Is BlackRock's fund available to retail investors?

Primarily for institutional clients like stablecoin issuers, but it signals broader crypto integration for traditional investors.