The Daily: BlackRock recommends 1-2% bitcoin allocation, Step Finance plans tokenized stocks on Solana and more

Happy Thursday! In today's newsletter, BlackRock recommends up to a 2% bitcoin allocation, Step Finance aims to bring tokenized stocks to Solana, Avalanche raises $250 million and more.

Meanwhile, former Grayscale Investments CEO Michael Sonnenshein joins Securitize as COO.

Plus, President-elect Donald Trump remains keen on a strategic crypto reserve, aiming to make the U.S. an industry leader.

Let's get started.

BlackRock recommends up to 2% bitcoin allocation

BlackRock, the world's largest investment firm with $11.5 trillion in assets under management and issuer of the largest spot Bitcoin ETF, recommended allocating up to 2% of multi-asset portfolios to bitcoin in an institutional investor report on Thursday.

• "First time they gave a specific number (they put this out because they had so much incoming on this question of how much)," Bloomberg Senior ETF Analyst Eric Balchunas noted on X, highlighting excerpts of the report.
• "Bitcoin cannot be compared to traditional assets," BlackRock wrote. "But from a portfolio construction perspective, the 'magnificent 7' group of mostly mega-cap tech stocks is a useful starting point."
• "In a traditional portfolio with a mix of 60% stocks and 40% bonds, those seven stocks each account for, on average, about the same share of overall portfolio risk as a 1-2% allocation to bitcoin. We think that's a reasonable range for a bitcoin exposure," the firm said, explaining its rationale.
• However, going beyond that would sharply increase bitcoin's share of the overall portfolio risk, BlackRock warned.
• BlackRock's IBIT product holds over $50 billion in assets under management, according to The Block's Bitcoin ETF Tracker .

Step Finance aims to bring tokenized stocks to Solana

DeFi platform Step Finance has acquired early-stage startup Moose Capital, aiming to bring tokenized stock trading of major companies like Nvidia and Tesla to Solana , targeting a Q1 2025 launch.

• The acquisition includes regulatory licenses from multiple jurisdictions, with Step Finance to rebrand Moose Capital's product as Remora Markets for KYC-verified clients outside the U.S. and EU.
• Step Finance aims to capture a share of the $14 billion real-world asset market, currently dominated by Ethereum, leveraging Solana's speed, cost and scalability advantages.
• Tokenized stocks have struggled to break through in the crypto space due to regulatory uncertainty and a lack of institutional support. However, recent political changes and growing demand for RWA tokenization are changing the outlook, Step Finance co-founder George Harrap told The Block.

Avalanche raises $250 million locked token sale

Avalanche announced it raised $250 million in a locked token sale led by Galaxy Digital, Dragonfly and ParaFi Capital to support its Avalanche9000 upgrade.

• The upgrade, currently on testnet, is designed to drive scalable, purpose-built Layer 1s and aims to cut blockchain deployment costs by 99.9% and transaction costs by 25 times, with a mainnet launch set for Dec. 16.
• The project claims more than 500 Layer 1 chains are already in development across sectors like tokenization of real-world assets, loyalty, gaming, payments and institutional programs, such as DeFi Kingdoms, Dexalot, Off The Grid and Lamina1.
• Avalanche previously raised $230 million in a similar token sale led by Polychain in 2021.

Web3 notifications protocol Push to launch its own Layer 1 chain

Web3 notifications project Push Protocol is developing Push Chain , a Layer 1 focused on chain abstraction and building applications that are accessible across different networks.

• Push Chain will feature wallet and gas fee abstraction, sharding and sub-one-second transaction finality, aiming to improve scalability and user experience.
• The initial testnet for Push Chain is set to launch in phases starting mid-January 2025, with the mainnet expected later that year.
• Push Protocol, formerly known as Ethereum Push Notification Service, is evolving from a communication protocol to a settlement layer for Layer 1s and Layer 2s, enabling "universal smart contracts."

Frax is developing a tech stack for AI agents on blockchain

Decentralized stablecoin protocol Frax Finance is developing a tech stack as a parallelized blockchain within its Layer 2 rollup Fraxtal to enable autonomous, tokenized AI agents .

• Frax claims this will allow AI agents to become fully autonomous with no single point of control and ultimately help AI and blockchain to collaborate more seamlessly.
• The "AIVM" tech stack is part of the project's broader 2025 roadmap, which also includes rebranding its FRAX stablecoin and upgrading its network via a hard fork.

In the next 24 hours

• UK GDP data are released at 2 a.m. ET on Friday.
• Global Blockchain Show 2024 concludes in Dubai.

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