Fidelity Applies to Launch On-Chain U.S. Treasury Fund, Joining Asset Tokenization Race
Over the past year, tokenized money market fund size has grown six-fold, reaching $4.8 billion, currently led by BlackRock's product.
What you need to know:
- Fidelity Investments has submitted an application to register a blockchain-based U.S. dollar money market fund, officially joining the asset tokenization race.
- The application documents show that the fund currently operates on the Ethereum network and may expand to other blockchains in the future, expected to take effect on May 30 after regulatory approval.
- As a financial giant managing $5.8 trillion in assets, Fidelity becomes the latest institution to enter the rapidly growing U.S. Treasury tokenization market, which has grown nearly 500% over the past year.
Fidelity Investments has submitted documents applying to register a blockchain tokenized version of its U.S. dollar money market fund, officially joining the asset tokenization race.
According to the application filed with the SEC on Friday, Fidelity plans to register the "OnChain" share class of its Fidelity Treasury Digital Fund (FYHXX), using blockchain as a transfer agent. FYHXX primarily holds cash and U.S. Treasuries and was launched at the end of last year.
The application documents show that the fund's OnChain shares currently operate on the Ethereum (ETH) network and may expand to other blockchains in the future. The registration is still pending regulatory approval and is expected to take effect on May 30.
This application comes as global banks and asset management companies increasingly migrate traditional financial instruments like government bonds, credits, and funds to blockchain platforms, a process often referred to as real-world assets (RWAs) tokenization. This move aims to enhance operational efficiency and enable faster, round-the-clock settlement.
Fidelity Investments, managing $5.8 trillion in assets, is the latest traditional financial giant attempting to enter the rapidly growing U.S. Treasury tokenization market.
BlackRock (BLK) launched the BUIDL tokenized Treasury fund in March last year in collaboration with digital asset company Securitize and has become the market leader, with assets approaching $1.5 billion, according to rwa.xyz.
Franklin Templeton's fund was the first on-chain money market product and has attracted $689 million in assets since its launch in 2021.
Currently, the entire U.S. Treasury tokenization market has reached $4.77 billion, growing nearly 500% over the past year, according to rwa.xyz.
Additionally, Fidelity is one of the main issuers of U.S. spot Bitcoin and Ethereum ETFs, with its FBTC (Bitcoin ETF) reaching $16.5 billion and FETH (Ethereum ETF) reaching $780 million, according to SoSoValue data.
