The GENIUS Act, signed into law last year, established the first federal framework for stablecoins in the United States. Among other requirements, issuers must hold reserves in cash, short-term government securities and certain government money market funds.
The legislation has created an opportunity for traditional asset managers to offer regulated vehicles that stablecoin issuers can use to manage these reserves while generating returns.
Fidelity’s fund will invest in U.S. Treasury bills, notes and bonds with maturities of 93 days or less, cash, overnight repurchase agreements, backed by Treasuries and other government money market funds that comply with the law.
“Fidelity has a long history in fixed income and money markets, which makes us uniquely positioned to offer a money market fund to stablecoin issuers that complies with the new GENIUS Act legislation,” Robin Foley, Fidelity’s head of fixed income, said in a statement.
While Fidelity’s announcement focused on reserve management, State Street framed the launch as part of a broader push into tokenized finance through partnerships with crypto firms like Anchorage Digital and products designed for onchain liquidity management.
