Money market funds

A money market fund invests in very safe, short-term debt, such as US Treasury bills, and pays a small return. Companies and investors use it as a place to park cash. Today, buying and selling shares runs through a transfer agent, the firm that keeps the official list of who owns the fund, and it only happens during business hours. The shares can’t easily be handed to someone else or used to back a trade.

Tokenizing a fund means issuing or recording its shares as tokens on a blockchain. The shares can then move between approved investors at any hour, and they can be used as collateral, meaning they’re pledged to back a trade or a loan. That’s the big draw: cash posted as collateral usually earns nothing, but a fund share keeps earning while it does the same job. In June 2025, the crypto trading platforms Crypto.com and Deribit began accepting BlackRock’s tokenized fund, BUIDL, as collateral from some institutional clients.

Franklin Templeton was an early mover. Its OnChain U.S. Government Money Fund, launched in 2021, was the first US-registered fund to use a public blockchain to process transactions and record who owns its shares. Each share is one BENJI token. In July 2025, BNY and Goldman Sachs began letting institutional clients buy money market fund shares from managers including BlackRock, Fidelity and Federated Hermes, with ownership mirrored as tokens on Goldman’s blockchain.