Asset manager Fidelity requested tokenized dollar funds based on Ethereum
- The new tokenized money market fund makes the Ethereum network attractive for institutions-provided that the SEC allows it.
- The fund would be a model case for such tokenized investment products, and the interest of institutions in Ethereum should probably increase.
Fidelity Investments takes a further step into the crypto sector with his recent application at the US stock exchange supervision SEC for a tokenized dollar money market fund. Fidelity had previously applied for an Ethereum ETF that offered a premium for the use of tokens-CNF reported.
According to the SEC application, the fund will introduce an onchain share class that is recorded on the Ethereum blockchain. The fund would not invest directly in cryptocurrencies, but 99.5 % of its stocks would be created in US state bonds and cash to ensure a stable and highly liquid investment tool.
Like from the SEC application Fidelity strives to register a tokenized version of his money market fund. The application says:
“The Onchain class of the fund is currently using the Ethereum network as a public blockchain. In the future, the fund can use other public blockchain networks, subject to suitability and other requirements that the fund can impose.”
Currently, 80% of the fund’s assets are kept in US state bonds, the interest of which is due when due. Fidelity’s decision to use Ethereum underlines the growing reputation of the network as a preferred platform for the tokenization of financial products.
Although the application does not mention an immediate secondary market for these digital stocks, it indicates the possibility of a future peer-to-peer trade of shares on the blockchain. This could open the door for increased liquidity and accessibility on the traditional investment markets.
Consequences for finance and markets
Through the tokenization of traditional assets, companies like Fidelity pave the way for a more digital, decentralized financial system.
In addition, WuBlockchain tweeted that the registration is subject to official approval and that the product is expected to be available on June 1st. Fidelity currently manages $ 5.8 trillion for its customers.
Fidelity has filed with the U.S. SEC to register a blockchain-based tokenized U.S. dollar money market fund, initially built on Ethereum with potential expansion to other blockchains. The registration is subject to regulatory approval, with the product expected to go live on May…
— Wu Blockchain (@WuBlockchain) March 23, 2025
If the project is successful, it could promote the further introduction of systems-supported systems at institutions and create a model case for future tokenized investment products.
In any case, the Fidelity application increased the attractiveness of Ethereum for institutional investors and the ETH course has reacted. According to Coin Market Cap data, ETH was traded at $ 2,045.60 when writing this article, after an increase of 2.54% in 24 hours earlier and 7.68% last week. The ETH course diagram shows more details.
No Comments