HBAR Crashes After Surge Sparked by BlackRock Tokenisation Rumours

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  • HBAR’s price skyrocketed by 105% due to misconceptions that BlackRock was involved in a tokenisation project with Hedera.
  • The actual tokenisation of BlackRock’s US Treasury money market fund was conducted by Archax in partnership with Hedera, leading to initial investor confusion.
  • Despite a subsequent 36% drop after clarifications, HBAR’s price remains 32% higher, fuelled by broader enthusiasm for tokenisation projects.

Hedera’s HBAR token had seen tremendous gains on Tuesday, sky-rocketing 105% from US$0.087 (AU$0.133) to US$0.18 (AU$0.276) in the space of 12 hours. However, in the early hours of Wednesday local Australian Time, HBAR started to drop and has since plummeted almost 36% as data from TradingView reveals.

HBAR/USD, source: TradingView

The rise and subsequent fall – something not unheard of in the crypto space – came on the news that BlackRock somehow would be involved with Hedera in a tokenisation venture.

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BlackRock later confirmed that it had neither any involvement in this nor any relationship with Hedera.


Tokenisation in Collaboration with Archax, not BlackRock

The news that BlackRock’s US Treasury money market fund had been tokenised on the Hedera blockchain was somehow misinterpreted. Many investors initially jumped to the conclusion that BlackRock itself was directly involved in the tokenisation process. However, this was not the case, as the Hedera Foundation later explained:

The tokenisation had actually been handled by Archax, in collaboration with Hedera. Archax, a regulated digital asset exchange, had announced the expansion of its offerings to include tokenised shares of this BlackRock money market fund, along with others, using the Hedera and Ethereum blockchains.

The confusion led to the temporary spike in HBAR’s price, which later adjusted downwards as investors realised BlackRock’s non-involvement in the tokenisation process itself.

CEO and co-founder of Archax, Graham Rodford, commented:

It was indeed an Archax choice to put on Hedera and, given our reg status we are one of the only places that can create, custody and trade these. It was our choice but everyone involved was aware.

Graham Rodford, Archax CEO

BlackRock’s Venture Signals Broader Enthusiasm

The price of HBAR is still up 32% from before the news broke – which is on the back of widespread excitement about tokenisation.

BlackRock itself has ventured into the tokenisation realm just recently with its collaboration with Coinbase and Securitize for a tokenised Ethereum fund.

The new Ethereum-based fund named BUIDL, introduced by BlackRock, is designed specifically for qualified investors, with each token priced at US$1.

Unlike many blockchain-based investment vehicles that delve into decentralised finance (DeFi), BUIDL operates more traditionally. It generates yield through conventional financial instruments such as cash holdings, treasury bills, and debt securities.

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This approach ensures that while BUIDL leverages blockchain technology for its infrastructure and operations, it does not engage with the DeFi sector’s more complex and often riskier mechanisms.

Aaron Feuerstein

Aaron Feuerstein

Aaron Feuerstein is a freelance writer based in Melbourne. His focus is on decentralised finance and the regulatory space surrounding blockchain. He holds a Master's in Accounting. When he is not studying the latest legal case, he enjoys his time as a modest but eager hobby cook.

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