- Fidelity Investments has filed to register “OnChain,” a tokenized version of its $80 million US Treasury money market fund on Ethereum.
- The tokenized share class aims to provide transparency for FYHXX transactions while maintaining traditional book-entry records as the official ownership ledger.
- The RWA tokenization market for Treasury products has reached $4.78 billion, with BlackRock‘s BUIDL fund leading at $1.46 billion.
Fidelity Investments is entering the blockchain tokenization space with a filing to register a tokenized version of its US dollar money market fund on the Ethereum network. The $5.8 trillion asset manager joins competitors like BlackRock and Franklin Templeton in leveraging blockchain technology for traditional financial assets.
According to Fidelity’s March 21 filing with the Securities and Exchange Commission, the asset manager will use a system called “OnChain” to track transactions of the Fidelity Treasury Digital Fund (FYHXX) – an $80 million fund primarily invested in US Treasury bills. The filing said the tokenized share class is pending regulatory approval but is expected to take effect on May 30.
The documents clarify that while OnChain will provide investors with transparent and verifiable tracking of FYHXX share transactions, Fidelity will maintain traditional book-entry records as the official ownership ledger. The filing states: “Although the secondary recording of the OnChain class on a blockchain will not represent the official record of ownership, the transfer agent will reconcile the secondary blockchain transactions with the official records of the OnChain class on at least a daily basis.”
Importantly, Fidelity noted that the actual US Treasury bills within the fund wouldn’t be directly tokenized. The asset manager also indicated it may expand OnChain to other blockchain networks beyond Ethereum in the future.
The move comes amid significant growth in real-world asset (RWA) tokenization across the financial industry. According to data from rwa.xyz, the tokenized Treasury products market is currently valued at $4.78 billion. BlackRock’s USD Institutional Digital Liquidity Fund (BUIDL) leads this segment with $1.46 billion in assets.
The Ethereum network dominates the tokenization landscape with over $3.3 billion worth of RWAs, while the Stellar network follows at a distant second with $465.6 million.
BlackRock’s head of crypto, Robbie Mitchnick, recently reinforced Ethereum’s position in the tokenization space. At the Digital Asset Summit in New York on March 20, he said: “There was no question that the blockchain we would start our tokenization on would be Ethereum, and that’s not just a BlackRock thing, that’s the natural default answer.”
Mitchnick added, “Clients clearly are making choices that they do value the decentralization, they do value the credibility, and the security and that’s a great advantage that Ethereum continues to have.”
This trend of major institutional players exploring blockchain technology for traditional assets signals growing confidence in the technology’s potential to enhance transparency and efficiency in financial markets.
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