The GENIUS Act, enacted last year, established the first federal framework for payment stablecoins in the United States. Among other requirements, issuers must maintain reserves of cash, short-term Treasury 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 those reserves while generating yield.
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 Treasury bonds and other compliant government money market funds.
“Fidelity has a long history in the fixed income and money markets, which puts us in a unique position to offer a money market fund for stablecoin issuers that complies with the new GENIUS-Act legislation,” Robin Foley, head of fixed income at Fidelity, said in a statement.
While Fidelity’s announcement focused on reserve management, State Street framed its launch as part of a broader push toward tokenized finance through partnerships with crypto companies like Anchorage Digital and products designed for on-chain liquidity management.
