BlackRock has urged the Office of the Comptroller of the Currency to remove a proposed cap on tokenized reserve assets [1].

The request targets the implementation of the GENIUS Act, a regulatory framework affecting how financial institutions handle digital assets. If the cap remains, it could limit the growth of tokenized investment products and restrict the flexibility of institutional reserve management.

In a comment letter to the OCC, BlackRock said the regulator should drop a proposed 20% [1] cap on tokenized reserve assets. The firm also said the agency should expand the list of assets eligible for tokenization under the act [1].

These changes are intended to prevent limitations on specific products, such as the BUIDL fund, and to facilitate the broader adoption of tokenized assets within the U.S. financial system [1]. The OCC originally proposed the rule on Feb. 25 [2].

This push for regulatory flexibility aligns with the firm's broader strategy regarding the digitization of finance. In a February 2024 letter to shareholders, BlackRock Chairman Larry Fink said, "Real World Assets (RWA) are being built into the pipeline of Wall Street product offerings" [3].

By advocating for the removal of the 20% [1] limit, BlackRock is seeking a regulatory environment that allows for a higher concentration of tokenized assets in reserves. The firm said that a broader scope of eligible assets would better support the transition toward digital infrastructure in traditional finance [1].

“BlackRock has urged the Office of the Comptroller of the Currency to remove a proposed cap on tokenized reserve assets.”

This move signals a direct effort by the world's largest asset manager to shape U.S. digital asset regulation to fit its product roadmap. By opposing the 20% reserve cap, BlackRock is attempting to ensure that tokenized funds can scale without hitting regulatory ceilings that would force them to hold less efficient, traditional assets. The outcome of this request will likely determine how quickly traditional Wall Street products migrate to blockchain-based rails.