Fidelity Launches Tokenized Money Market Fund on Ethereum with $202M Backing
Fidelity Investments introduces a tokenized money market fund on the Ethereum blockchain, marking a significant entry into the fast-growing tokenized asset sector.
Overview
Fidelity Investments has successfully launched its tokenized money market fund on the Ethereum blockchain, achieving a substantial backing exceeding $200 million.
- Key Details
- The Fidelity Digital Interest Token (FDIT) made its debut with a minting of over $202 million.
- Ondo Finance serves as the chief investor, utilizing the token as a reserve for its OUSG yield-generating token.
- The tokenized U.S. Treasuries market has expanded more than threefold within a year as major banks strive for round-the-clock settlements.
Tokenized Asset Introduction
Fidelity’s latest offering, the Fidelity Digital Interest Token, is representative of the Fidelity Treasury Digital Fund, designated to yield returns by investing in U.S. Treasury bills. Initially disclosed in a regulatory filing to the U.S. Securities and Exchange Commission (SEC) back in March, this launch marks Fidelity’s entry into the burgeoning tokenized asset realm.
The significant investor for this initiative is Ondo Finance, with a current holding of $202 million in FDIT, backing its OUSG token which aggregates several tokenized money market funds to maintain its value.
Market Growth
In the past year, the tokenized U.S. Treasuries market has experienced remarkable growth, increasing to $7.5 billion. This uptick is supported by major players such as BlackRock and Securitize, who lead the market with the $2.4 billion BUIDL token.
The tokenization of government debt promotes faster settlements, enhances transparency, and expands market operations beyond traditional hours. This initiative is part of a broader trend to transition significant financial instruments to blockchain technology.
Read more: Nasdaq Seeks Nod From U.S. SEC to Tokenize Stocks
