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BlackRock Fund Tokenization on Hedera Sparks Debate, HBAR Price Rises 70% – How is it Different to BUIDL?

Last Updated April 24, 2024 8:56 AM
Valdrin Tahiri
Last Updated April 24, 2024 8:56 AM
By Valdrin Tahiri
Verified by Peter Henn

Key Takeaways

  • Archax announced the launch of a tokenized BlackRock fund on Hedera.
  • The HBAR price increased over 70% on April 23 after the news.
  • Has BlackRock actually partnered with Hedera, or is the news misleading?

Hedera is outpacing the crypto market with its 70% increase in the past 24 hours. The increase occurred as a result of an announcement regarding a tokenized BlackRock fund on Hedera.

While the announcement in itself has drawn skepticism, the HBAR price reclaimed and important horizontal area, leading to the possibility that it started a new bullish trend toward its all-time high.

HBAR Announces Tokenized Fund

On April 23, Hedera announced that BlackRock’s ICS U.S. Treasury Money Market Fund  (MMF) is being tokenized in partnership with Archax and OwneraIO. Hedera claims to finally bring the world’s largest asset manager on-chain. The foundation noted that this further grows the portfolio of Real-World Assets (RWA) on Hedera.

Previously, the Archax exchange had announced  the creation of a tokenized fund for Aberdeen Standard Liquidity Fund, leveraging Hedera’s technology. Archax chose Hedera  for various reasons, primarily because of the Hedera Token Service (HTS).

This service empowers Archax to tokenize traditional financial instruments on the Hedera Network, enabling fractional ownership of assets and thereby boosting liquidity.

However, it is worth mentioning that BlackRock has already filed for a tokenized fund using Ethereum. It did so in late March and the fund is called BlackRock USD Institutional Digital Liquidity Fund (BUIDL) . The fund was launched with Securitize, an asset tokenization company.

So, BlackRock has already ventured on-chain before the tokenization of its ICS US Treasury Fund.

Did HBAR Actually Partner With BlackRock?

While the HBAR price reacted positively to the news, there is a debate going on about what the partnership actually is, since BlackRock’s X account  has not posted about it. It seems that Archax, the digital exchange which partners with Hedera is offering the BlackRock MMF to its users in tokenized form.

So, Anthrax has purchased shares  of the BlackRock MMF, tokenized them and is issuing them on its platform in partnership with Hedera. It does not seem that BlackRock has actually partnered with Anthrax for this venture.

In contrast, BlackRock’s head of digital assets Robert Mitchnick commented  about their partnership with Securitize once they released the BUIDL fund, while they have not mentioned the MMF.

Similarities and Differences to BUIDL Fund

The first main difference is that when BlackRock announced the BUIDL fund, they partnered with Securitize and tokenized it on the Ethereum blockchain. On the other hand, Anthrax itself purchased and tokenized BlackRock’s MMF, releasing it on Hedera.

While both are tokenized fund ownerships, the main difference lies in the form of partnership.

The partnership between BlackRock and Securitize for the tokenization of the BlackRock USD Institutional Digital Liquidity Fund (BUIDL) involves a direct collaboration between the two entities.

On the other hand, the tokenization of the BlackRock fund through Archax appears to involve Archax’s partnership with Hedera. BlackRock’s involvement is primarily as the issuer of the fund.

BlackRock has not partnered with neither Hedera nor Ethereum.

Has a 70% HBAR Price Increase Been Seen Before?

The HBAR price increased over 70% on April 23, leading to a new yearly high of $0.18 the next day. However, it failed to sustain the increase and is in the process of creating a bearish candlestick. 

Additionally, HBAR did not break out from its ascending parallel channel. The channel has existed since August 2023, and the rejection was the fourth failed attempt at breaking out.

HBAR Price Increase Channel
HBAR/USDT Daily Chart | Credit: TradingView

There have been two similar daily increases in the past, both occurring in January 2021. On January 7 and 20, HBAR increased by 62% and 61%, respectively. It fell significantly the next day both times. But, it eventually resumed its upward movement, leading to new highs.

HBAR Price Previous Movement
HBAR/USDT Daily Chart | Credit: TradingView

The movements differ to the current one because of the amount of retracement relative to the previous all-time high. In the January 8, 2021, movement, HBAR had just reached the 0.618 Fib retracement resistance level, while it had already reached a new all-time high on January 20.

Currently, the HBAR price is well below the 0.382 Fibonacci retracement resistance level.

HBAR Price Prediction: Beginning of Bullish Trend or Local Top?

The weekly time frame suggests the increase is the beginning of a long-term bullish trend. This is because the ongoing bounce took HBAR above the $0.09 horizontal area.

The area had provided resistance for 630 days, but HBAR seemingly fell below it in April (green circle). The bounce confirmed that the decrease was just a deviation and validated the $0.09 area as support.

HBAR Price Bullish Trend
HBAR/USDT Weekly Chart | Credit: TradingView

During the price increase, the weekly RSI bounced at 50 and the MACD made a bullish cross (green icons). So, indicator readings support the beginning of a new bullish trend.

The next resistance area is at $0.24, 80% above the current price. This bullish prediction remains valid as long as the HBAR price does not close below $0.09 in the weekly time frame.

HBAR Trend Bullish Despite Misleading Announcement

The significant increase in HBAR prices following Hedera’s announcement of tokenizing a BlackRock fund sparks skepticism regarding the nature of the collaboration. Meanwhile, technical analysis points toward a bullish trajectory for HBAR, given it sustains the critical support level at $0.09.

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