Bank of New York Mellon (BNY) and Goldman Sachs (GS) roll out of the tokenized money market funds for clients as the adoption of digital active accelerates.
BNY, one of the oldest and largest custody banks in the world, who oversees $ 53 trillion of assets, announced Wednesday to start offering institutional investors token versions of the Money Market Fund’s share classes through its liquidity distribution platform. Ownership registers and transactions are recorded on Goldman Sach’s Digital Asset Platform’s Blockchain. Institutions that have signed up include BlackRock, Fidelity among others.
BNY serves as a shareholder service and depository for the funds, new role as Tokenization Manager, who is responsible for triggering coin and combustion of tokens, mirroring funds shares on BNY’s books, according to the offer’s website.
“The step of tokenization is important, because today, enabling seamless and effective transactions, without the friction happening in traditional markets,” Laide Majiyagbe, BNY’s global liquidity leader, financing and security, told CNBC.
Tokenized money market funds, predominantly supported by US state securities, have been at the forefront of tokenization efforts, bringing traditional asset classes to blockchain rails.
The market for tokenized US Treasury peaked $ 7 billion this year, more than triple in a year, Rwa.xyz data shows. As it is growing rapidly, it is only a fraction of the total market for $ 7 trillion money market fund market.
