Key Points:

• Fidelity Investments has submitted an application for a blockchain-based version of its U.S. dollar money market fund, to enter the tokenized asset market.
• The fund currently utilizes the Ethereum network but may extend to other blockchains, with plans to launch on May 30 pending regulatory approval.
• Fidelity, managing $5.8 trillion in assets, joins other major financial institutions in the rapidly expanding tokenized U.S. Treasuries market, which has surged nearly 500% in the past year.

U.S.-based asset manager Fidelity Investments has filed paperwork to register a blockchain-based, tokenized version of its U.S. dollar money market fund, aiming to join the tokenized asset race. According to a Friday filing to the U.S. Securities and Exchange Commission (SEC), the company seeks to register an “OnChain” share class of its Fidelity Treasury Digital Fund (FYHXX) and use blockchains as transfer agents. FYHXX holds cash and U.S. Treasury securities and was launched late last year.

The OnChain class of the fund currently uses the Ethereum (ETH) network and the firm may expand to other blockchains in the future, the filing said. The registration is subject to regulatory approval, with the product expected to become effective on May 30.

The filing comes as global banks and asset managers increasingly transition traditional financial instruments like government bonds to blockchain technology, a process known as tokenization of real-world assets. They do this to achieve operational efficiency and enable faster, around-the-clock settlements.

Fidelity is now part of the fast-growing tokenized U.S. Treasuries sector, where it joins firms like Blackrock, which recently launched a tokenized T-bill fund called BUIDL, currently holding nearly $1.5 billion in assets. Franklin Templeton’s fund was the first on-chain money market product, accumulating $689 million since its 2021 launch.

As of now, the entire tokenized U.S. Treasury market is valued at $4.77 billion, reflecting a growth of almost 500% in the past year.

Fidelity is also known for being one of the largest issuers of spot bitcoin and ether exchange-traded funds (ETF) in the U.S., representing $16.5 billion in FBTC and $780 million in FETH, according to data from SoSoValue.