Fidelity Joins Tokenized Asset Race with Ethereum-Based Treasury Fund

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Fidelity Investments, one of the largest asset managers in the world, has officially joined the fast-growing tokenization movement by filing paperwork to register a blockchain-based, tokenized version of its US dollar money market fund.

The move signals a significant step forward in Wall Street’s integration with blockchain infrastructure and follows similar efforts by other financial giants.

Fidelity Taps Blockchain Integration for Faster, 24/7 Settlement

According to a Friday filing with the US Securities and Exchange Commission (SEC), the asset manager plans to launch an “OnChain” share class of its Fidelity Treasury Digital Fund (FYHXX), which currently holds cash and US Treasury securities.

Also read: Swift, UBS, and Chainlink Run Tokenized Fund Settlement Pilot

The new share class will operate on the Ethereum blockchain and may expand to other chains in the future, the filing notes. The registration is pending regulatory approval, with the product expected to go live by May 30.

This strategic move signals Fidelity’s commitment to embracing blockchain technology and joining the accelerating trend of tokenizing real-world assets (RWAs). By leveraging blockchain as a transfer agent, Fidelity aims to boost efficiency, transparency, and enable near-instant, around-the-clock settlement of traditional financial instruments—something conventional infrastructure struggles to offer.

Fidelity, which manages an astounding $5.8 trillion in assets, is entering a competitive yet promising market. The total market cap of tokenized US Treasuries has soared to $4.77 billion, marking a nearly 500% increase over the past year, according to data from rwa.xyz.

Also read: Discover the Visa Tokenized Asset Platform (VTAP)

BlackRock and Franklin Already Ahead

The move also pits Fidelity directly against BlackRock, which partnered with Securitize in March 2023 to launch BUIDL, a tokenized T-bill fund that has become the market leader with nearly $1.5 billion in assets. Additionally, Franklin Templeton, which pioneered the space with the first on-chain money market fund in 2021, now manages $689 million in tokenized assets.

Fidelity is no stranger to digital assets. It is one of the top issuers of cryptocurrency exchange-traded funds in the US, managing over $16.5 billion in its spot Bitcoin ETF (FBTC) and $780 million in its Ethereum ETF (FETH), according to SoSoValue.

Also read: Chainlink Report Predicts Tokenized Asset Market to Reach $10 Trillion by 2030

As regulatory clarity continues to evolve and traditional finance embraces blockchain, Fidelity’s entry could serve as a catalyst for further adoption and innovation in the financial services industry.

Author

Steven Walgenbach

Steven's passion for cryptocurrency and blockchain technology began in 2014, inspiring him to immerse himself in the field. He notably secured a top 5 world ranking in robotics. While he initially pursued a computer science degree at the University of Texas at Arlington, he chose to pause his studies after two semesters to take a more hands-on approach in advancing cryptocurrency technology. During this period, he actively worked on multiple patents related to cryptocurrency and blockchain. Additionally, Steven has explored various areas of the financial sector, including banking and financial markets, developing prototypes such as fully autonomous trading bots and intuitive interfaces that streamline blockchain integration, among other innovations.

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